Key Moments
- Adjusted EPS of $1.69 exceeded estimates of $1.66, while quarterly revenue of $7.17 billion missed the $7.2 billion consensus.
- Core net new assets reached a record $190.4 billion, up 38% year-over-year, with total client assets rising to $13.33 trillion.
- Trading activity surged, with daily average trading volume up 44% year-over-year to 10.7 million, supporting a 16% increase in trading revenue to $1.2 billion.
Top- and Bottom-Line Performance
The Charles Schwab Corporation (NYSE: SCHW) reported its third-quarter results before the market opened on Thursday. In premarket trading following the release, the stock declined approximately 2.6%, and it was down 1.3% after the results.
On an adjusted basis, earnings per share came in at $1.69, ahead of analyst expectations of $1.66. Revenue totaled $7.17 billion, narrowly missing the consensus forecast of $7.2 billion. Still, the top line rose 17% year-over-year from $6.14 billion in the same quarter of 2025.
“Deeper client engagement across Schwab’s platform continues to broaden and strengthen our revenue model, helping our third-quarter revenue increase 17% year-over-year to a record $7.2 billion,” said CFO Mike Verdeschi.
Client Growth and Asset Trends
Schwab reported record core net new assets of $190.4 billion for the quarter, an increase of 38% compared with the prior year period and equivalent to an annualized growth rate of 5.8%. Client acquisition remained strong, with 1.2 million new brokerage accounts opened during the quarter, bringing the total number of client accounts to 48.6 million.
Total client assets expanded 15% year-over-year to $13.33 trillion. Client transactional sweep cash balances at the end of September stood at $492.8 billion, up $7.1 billion from the prior quarter-end.
| Client & Asset Metrics | Current Period | Change / Commentary |
|---|---|---|
| Core net new assets | $190.4 billion | Up 38% year-over-year; 5.8% annualized growth rate |
| Total client assets | $13.33 trillion | Up 15% year-over-year |
| New brokerage accounts | 1.2 million | Quarterly additions |
| Total client accounts | 48.6 million | After quarterly growth |
| Client transactional sweep cash | $492.8 billion | Up $7.1 billion vs prior quarter-end |
Profitability and Net Interest Income Drivers
Net income for the quarter was $2.9 billion on a GAAP basis, equal to $1.62 per share. Adjusted net income, which excludes $151 million of pre-tax transaction-related costs, was $3.0 billion. The company’s net interest margin improved to 3.04% during the period.
Bank loan balances reached $72.3 billion at the end of September, a 35% year-over-year increase. Margin loan balances climbed 14% quarter-over-quarter to $187.9 billion, reflecting heightened client borrowing activity.
| Income & Balance-Sheet Metrics | Current Period |
|---|---|
| GAAP net income | $2.9 billion ($1.62 per share) |
| Adjusted net income | $3.0 billion |
| Net interest margin | 3.04% |
| Bank loan balances (Sept month-end) | $72.3 billion |
| Margin loan balances | $187.9 billion |
Trading, Fees, and Revenue Mix
Trading activity accelerated, with daily average trading volume at 10.7 million, a 44% increase versus the same quarter a year earlier. This higher activity supported trading revenue of $1.2 billion, up 16% year-over-year.
Asset management and administration fees also contributed to revenue growth, rising 14% year-over-year to $1.9 billion.
Capital and Balance-Sheet Strength
Schwab reported that its capital position remained solid, with a preliminary consolidated Tier 1 Leverage ratio of 8.9%. This capital level accompanied continued growth in client assets, loans, and trading activity during the quarter.
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