In the evolving landscape of financial services, Charles Schwab Corporation‘s (NYSE:SCHW) latest earnings report marks a significant shift as the company demonstrates remarkable resilience and growth, defying market expectations.
Charles Schwab Corporation (NYSE:SCHW) shares are trading higher on Friday after the company reported second-quarter adjusted earnings per share of $1.14, beating the analyst consensus estimate of $1.07.
Quarterly sales of $5.851 billion (+25% year over year) outpaced the Street view of $5.651 billion.
“Retail investors and RIAs continued to turn to Schwab as a trusted partner, opening over 1 million new brokerage accounts and gathering $80.3 billion in core net new assets – up 31% versus 2Q24,” said President and CEO Rick Wurster.
Trading revenue increased 23% to $952 million due to robust volumes, while net interest revenue gained 31% to $2.822 billion.
Net interest margin expanded sequentially by 12 basis points to 2.65% due to the further reduction of higher-cost liabilities and a rebound in securities lending activity.
In the quarter under review, total client assets increased 14% year-over-year to a record $10.76 trillion.
Core net new assets of $80.3 billion bring year-to-date asset gathering to $218.0 billion – up 39% year-over-year.
New brokerage account openings rose 11% year-over-year to 1.1 million in the quarter. This growth led to 37.5 million active brokerage accounts and 45.2 million total client accounts.
Asset management and administration fees increased by 14% year-over-year to $1.6 billion, powered by organic growth, rebounding equity markets, and sustained product utilization.
“During the second quarter, we continued to enhance stockholder value by returning excess capital through multiple forms – including redeeming approximately $2.5 billion in preferred equity and repurchasing just over $350 million of common stock,” said CFO Mike Verdeschi.
The company exited the second quarter with cash and equivalents worth $32.2 billion.
The bank had $233.1 billion in deposits at the end of the quarter, down 8% year over year.
SCHW Price Action: Charles Schwab shares were up 3.05% at $95.94 at the time of publication Friday, according to Benzinga Pro.
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