SCHWAB CHARLES CORP Quarterly Report for Q3 Ended Sep 30, 2025

Summary

Charles Schwab Corporation (SCHW) reported a strong third quarter and first nine months of 2025, demonstrating significant growth across key financial and client metrics. Total net revenues surged by 27% year-over-year for the quarter and 23% year-to-date, driven by robust net interest revenue, which benefited from reduced bank supplemental funding and growth in lending activities. Asset management and administration fees also saw a healthy 13% increase, supported by higher money market fund balances and managed investing solutions. The company reported substantial net income growth, up 67% for the quarter and 56% year-to-date, translating into a significant improvement in diluted earnings per share (EPS), which grew 77% for the quarter and 62% year-to-date. Client asset gathering remained strong, with core net new assets up 44% for the quarter and 34% year-to-date, coupled with an 18% increase in new brokerage accounts. The company also continued its capital return initiatives, repurchasing $2.7 billion in common stock during the quarter and increasing its dividend by 8%. Management highlighted the strategic advantages of its 'Through Clients' Eyes' strategy, emphasizing client relationships as a driver of asset growth and revenue. The acquisition of Forge Global Holdings, Inc. for approximately $660 million was announced, expected to enhance private market capabilities. Financially, Schwab significantly reduced its bank supplemental funding by $35.1 billion year-to-date, improving its funding profile. Capital ratios remain strong, with the consolidated Tier 1 Leverage Ratio at 9.7% as of September 30, 2025. The company appears well-positioned to navigate the evolving market landscape, leveraging its scale, client focus, and disciplined expense management.

Key Highlights

• 1Total net revenues increased significantly, up 27% year-over-year in Q3 2025 and 23% year-to-date, driven by strong net interest revenue and asset management fees.
• 2Net income grew substantially, up 67% for the quarter and 56% year-to-date, leading to a 77% increase in diluted EPS for the quarter and 62% year-to-date.
• 3Client asset gathering accelerated, with core net new assets up 44% in Q3 2025 and new brokerage accounts increasing by 18% year-over-year.
• 4The company significantly reduced bank supplemental funding by $35.1 billion (70%) year-to-date, strengthening its funding structure.
• 5Capital returns remained a priority, with $2.7 billion in common stock repurchased in Q3 2025 and an 8% increase in the quarterly dividend.
• 6Schwab announced the acquisition of Forge Global Holdings, Inc. for approximately $660 million to expand into private markets.
• 7Strong operational efficiency was demonstrated through expense growth (4-5%) that lagged revenue growth, improving pre-tax profit margins to 49.2% in Q3 2025.

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