Schwab (SCHW) Q3 2026 Earnings Call: Revenue Reaches $7.2 Billion
Source Tradingkey
Key Takeaways
- Schwab reported record Q3 2026 net revenue of $7.2 billion, up 17% year over year, while adjusted EPS increased 29% to a record $1.69.
- Core net new assets reached $190 billion, up 38% year over year and equivalent to an annualized organic growth rate of nearly 6%. Clients opened 1.2 million brokerage accounts during the quarter.
- Adjusted expenses increased 9% to approximately $3.2 billion, below revenue growth. The adjusted pretax profit margin expanded about 350 basis points to 54.8%.
- Secured lending remained a major growth driver. Margin balances ended the quarter at $187.9 billion, while bank loans rose 35% year over year to $72.3 billion, primarily due to pledged asset line demand.
- Management expects full-year revenue growth and net interest margin expansion toward the lower end of its previously provided ranges. Expenses are also expected at the low end of the prior range, supporting approximately 800 basis points of positive operating leverage in 2026.
- Schwab said AI is supporting engagement, wealth conversations and efficiency. Developer productivity improved by about 25%, while client trading through LLMs and APIs doubled over the past six months.
Core Financial Data
| Metric | Q3 2026 | Change | Key driver or context |
|---|---|---|---|
| Total net revenue | $7.2 billion | +17% YoY | Growth across net interest, asset management and trading revenue |
| Net interest revenue | Nearly $3.5 billion | +14% YoY | Secured lending growth, including margin loans and pledged asset lines |
| Asset management and administration fees | $1.9 billion | +14% YoY | Equity market appreciation, organic growth and wealth solution adoption |
| Trading revenue | $1.2 billion | +16% YoY | Robust client activity and 10.7 million daily average trades |
| Bank deposit account fees | — | +40% YoY | Improved net yield |
| Adjusted expenses | Approximately $3.2 billion | +9% YoY | Higher activity-related costs, partly offset by efficiency gains |
| Adjusted pretax profit margin | 54.8% | +350 bps YoY | Revenue growth outpaced expense growth |
| Adjusted EPS | $1.69 | +29% YoY | Record quarterly result |
| Core net new assets | $190 billion | +38% YoY | Nearly 6% annualized organic growth rate |
| Managed investing net flows | $24 billion | +22% YoY | Record quarterly flows; Schwab Wealth Advisory flows rose 55% |
| Margin balances | $187.9 billion | — | Included continued growth in long/short activity |
| Bank loan balances | $72.3 billion | +35% YoY | Primarily driven by pledged asset line demand |
| Transactional sweep cash | $492.8 billion | +$7.1 billion QoQ | Organic growth and long/short activity, partly offset by market reinvestment |
Business and Operating Performance
Disclaimer: For information purposes only. Past performance is not indicative of future results.
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