Large U.S. law firms saw an average revenue increase of 12.4% during the first six months of 2026, according to survey data released Tuesday by Wells Fargo’s Legal Specialty Group. The growth represents an acceleration from the 11.2% revenue increase reported during the same period in 2025.
The Wells Fargo survey included responses from more than 140 law firms, including 69 of the 100 highest-grossing firms in the country. The data indicates that the revenue gains were primarily supported by higher billing rates and a 4.8% increase in demand, measured by the number of hours worked by lawyers.
Owen Burman, a senior consultant and managing director at Wells Fargo, attributed the rise in legal work to a broader spending boom in artificial intelligence (AI). According to Burman, this has generated increased legal demand for data center development and capital raising. Other industry metrics, including data from the Thomson Reuters Institute, have also indicated high demand and billing rates this year.
While revenues rose, the survey found that law firms faced challenges in collecting payments. Inventory levels increased by 17.7%, and the time taken to collect fees slowed by 5% during the first half of the year. Lawyer headcount grew by 2.9%, a decrease from the 3.4% growth rate seen in the first half of 2025, while productivity rose by 1.8%.
The scale of the reported growth is notable, with a 12.4% revenue jump following a year that already saw double-digit gains. For legal professionals, the 2.9% increase in headcount and 1.8% rise in productivity suggest a stabilized hiring market compared to last year, yet one where individual lawyers are handling a higher volume of billable hours. While the demand for hours is near record highs, the 5% slowdown in collection cycles indicates that while firms are billing more, they are waiting longer to receive payment from their clients.
The data suggests a shift in the legal market's focus toward technology-driven infrastructure. The knock-on effects could influence future hiring trends and pay structures within the legal industry, particularly in practice areas tied to AI. Burman stated that the results of collections in the second half of 2026 will determine the overall success of the fiscal year. Industry analysts and firm management will likely monitor these collection rates through the end of December to assess whether the high demand translates into realized profits.