Wells Fargo & Company (NYSE:WFC) reported a net interest income of $11.71 billion on Tuesday, down 2% year over year in the second quarter of 2025.
Lower net interest income was driven by the impact of lower interest rates on floating rate assets and deposit mix changes, partially offset by lower market funding and deposit pricing.
The bank reported earnings of $1.60 per share, beating the consensus of $1.40. Revenue increased 1% year over year to $20.82 billion. Analysts expected $20.78 billion.
Noninterest income increased 4%, and included the gain associated with the merchant services joint venture acquisition, an increase in asset-based fees in Wealth and Investment Management on higher market valuations, and higher investment banking fees, partially offset by lower net gains from trading in the Markets business.
Corporate and Investment Banking revenues decreased 3% to $4.67 billion.
Banking was down 7%, driven by lower interest rates, partially offset by lower deposit pricing and higher investment banking revenue, including higher advisory fees.
Commercial Real Estate was down 6% due to lower loan balances, the impact of lower interest rates, and lower mortgage banking income reflecting the sale of our commercial non-agency third-party servicing business in the first quarter of 2025.
These decreases were partially offset by higher revenue in the affordable housing business and increased capital markets activity.
Average loans were almost unchanged at $916.7 billion, as higher commercial and industrial loans largely offset declines in commercial real estate and residential mortgage loans. These loans were up $8.5 billion, or 1%, from the first quarter of 2025, driven by commercial and industrial loan growth.
Average deposits reached 1.33 trillion, down from 1.35 trillion a year ago. They were down $14.8 billion, or 1%, due to a reduction in higher-cost CDs issued by Corporate Treasury; they were also down $7.6 billion, or 1%, from the first quarter of 2025.
Outlook
For fiscal year 2025, Wells Fargo expects net interest income to be roughly in line with the 2024 income of $47.7 billion.
In April, Wells Fargo expected net interest income to be ~1 to 3% higher than the 2024 net interest income of $47.7 billion.
In its second quarter earnings presentation, the bank says the largest driver of the change from prior guidance is lower net interest income in the Markets business, largely offset by higher noninterest income.
Wells Fargo expects 2025 noninterest expense to be ~$54.2 billion, unchanged from prior guidance.
Price Action: WFC stock is trading lower by 3.27% to $80.70 during the premarket session at last check Friday.
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