How did Morgan Stanley perform in the fourth quarter of 2025 compared with the prior year?

Q4 2025 net revenues were $17.9 billion, up 10% from $16.2 billion, and diluted EPS was $2.68 versus $2.22. Pre-tax income rose to $5.8 billion from $4.9 billion, and the firm's pre-tax margin was 32%. Compared with the prior quarter, revenues declined 2% and EPS declined 4%, mainly because Institutional Securities trading revenues fell from a strong Q3.

What drove the strong full-year 2025 results?

Full-year growth was broad-based. Investment Banking revenues rose 22% and Equity trading and financing revenues rose sharply on higher prime brokerage balances and client activity. Wealth Management benefited from higher asset-based fees, a 17% increase in transactional revenue excluding deferred compensation marks, and loan growth. Higher market levels also lifted Investment Management revenues.

Is Morgan Stanley's capital position weaker or stronger than a year ago?

The Standardized CET1 ratio fell to 15.0% from 15.9% a year earlier, but it remains well above regulatory requirements. The presentation cites excess CET1 of roughly 320 basis points above the requirement of about 11.8%. Risk-weighted assets rose 17% to $553 billion, outpacing growth in CET1 capital, which rose 11%. The firm continued returning capital through buybacks and dividends.

What are the key risks or watch items highlighted in the filing?

The firm recorded $87 million of charge-offs in Q4, mostly on a single commercial real estate loan that had been largely reserved. Loans grew 17% year over year to $289 billion, and the Institutional Securities provision was $302 million for the year. Expense growth of 10% and a compensation ratio tied to deferred compensation marks are also factors investors should monitor. Forward-looking statements carry standard risk disclaimers.

What are management's stated long-term goals?

The investor presentation lists firmwide goals of more than $10 trillion in client assets, a Wealth Management pre-tax margin of 30%, ROTCE of 20%, an efficiency ratio of 70%, and continued Institutional Securities wallet share gains. Current 2025 results of $9.3 trillion in client assets, a 29.3% Wealth Management pre-tax margin, a 21.6% ROTCE, and a 68% efficiency ratio put the firm close to several of these targets.

MORGAN STANLEY 8-K: Earnings & Results & Regulation FD

01—Abstract

Summary

Summary of the 8-K filed January 15, 2026. Cited figures are marked; the original filing is the authoritative source.

Morgan Stanley reported strong fourth-quarter and full-year 2025 results on January 15, 2026.

Fourth-quarter net revenues were $17.9 billion^a, up 10% year over year, and diluted EPS was $2.68 versus $2.22 a year ago. Full-year net revenues reached a record $70.6 billion (up 14%), net income applicable to Morgan Stanley was $16.9 billion, diluted EPS was $10.21 (up 28%), and ROTCE was 21.6% versus 18.8% in 2024. Sequentially, fourth-quarter revenue fell 2% from $18.2 billion in the third quarter, with Institutional Securities down 7% on lower Fixed Income and Equity trading versus a strong prior quarter, while Investment Banking rose 14%.

The segment picture was mixed but broadly constructive. Wealth Management delivered record full-year net revenues of $31.8 billion^b and a 29.3% full-year pre-tax margin, with $356 billion in net new assets and total client assets of $9.3 trillion. Institutional Securities posted record full-year revenues of $33.1 billion, led by Equity (up 28%) and Investment Banking (up 23%).

Investment Management reached record revenues of $6.5 billion^c. Fourth-quarter provision for credit losses was modest at $18 million, though Institutional Securities took $87 million of charge-offs tied largely to a single commercial real estate loan. Capital and shareholder returns remained strong.

The Standardized CET1 ratio was an estimated 15.0% at year end, versus 15.9% a year earlier, and the firm repurchased $4.6 billion^d of stock in 2025 and $1.5 billion in the fourth quarter. The Board declared a $1.00 quarterly dividend payable February 13, 2026.

The investor presentation reaffirmed firmwide goals of more than $10 trillion in client assets, a 30% Wealth Management pre-tax margin, 20% ROTCE, and a 70% efficiency ratio. Investors should note the sharp year-over-year gain in full-year profitability alongside a lower year-end CET1 ratio and a meaningful increase in total assets to $1.42 trillion.

02—Key points

Key Highlights

Record full-year 2025 net revenues of $70.6B (+14% YoY) and net income applicable to Morgan Stanley of $16.9B (+26%)
Full-year diluted EPS of $10.21 (vs. $7.95 in 2024) and ROTCE of 21.6% (vs. 18.8%)
Q4 2025 net revenues of $17.9B (+10% YoY, -2% QoQ) and diluted EPS of $2.68 (vs. $2.22 a year ago)
Wealth Management record FY revenues of $31.8B with $356B of net new assets and $9.3T in total client assets
Institutional Securities record FY revenues of $33.1B, with Equity up 28% and Investment Banking up 23%
Standardized CET1 ratio of 15.0% at year end (vs. 15.9% a year earlier), with $4.6B of FY2025 buybacks and a $1.00 quarterly dividend
Balance sheet expanded to $1.42T in total assets (+17% YoY), and the firm reiterated its 2026-oriented firmwide goals

03—Questions

Frequently Asked Questions

How did Morgan Stanley perform in the fourth quarter of 2025 compared with the prior year?
Q4 2025 net revenues were $17.9 billion, up 10% from $16.2 billion, and diluted EPS was $2.68 versus $2.22. Pre-tax income rose to $5.8 billion from $4.9 billion, and the firm's pre-tax margin was 32%. Compared with the prior quarter, revenues declined 2% and EPS declined 4%, mainly because Institutional Securities trading revenues fell from a strong Q3.
What drove the strong full-year 2025 results?
Full-year growth was broad-based. Investment Banking revenues rose 22% and Equity trading and financing revenues rose sharply on higher prime brokerage balances and client activity. Wealth Management benefited from higher asset-based fees, a 17% increase in transactional revenue excluding deferred compensation marks, and loan growth. Higher market levels also lifted Investment Management revenues.
Is Morgan Stanley's capital position weaker or stronger than a year ago?
The Standardized CET1 ratio fell to 15.0% from 15.9% a year earlier, but it remains well above regulatory requirements. The presentation cites excess CET1 of roughly 320 basis points above the requirement of about 11.8%. Risk-weighted assets rose 17% to $553 billion, outpacing growth in CET1 capital, which rose 11%. The firm continued returning capital through buybacks and dividends.
What are the key risks or watch items highlighted in the filing?
The firm recorded $87 million of charge-offs in Q4, mostly on a single commercial real estate loan that had been largely reserved. Loans grew 17% year over year to $289 billion, and the Institutional Securities provision was $302 million for the year. Expense growth of 10% and a compensation ratio tied to deferred compensation marks are also factors investors should monitor. Forward-looking statements carry standard risk disclaimers.
What are management's stated long-term goals?
The investor presentation lists firmwide goals of more than $10 trillion in client assets, a Wealth Management pre-tax margin of 30%, ROTCE of 20%, an efficiency ratio of 70%, and continued Institutional Securities wallet share gains. Current 2025 results of $9.3 trillion in client assets, a 29.3% Wealth Management pre-tax margin, a 21.6% ROTCE, and a 68% efficiency ratio put the firm close to several of these targets.

04—Continue

← View all 8-K filings