Wells Fargo (NYSE:WFC) stock climbed 2.6% in Tuesday premarket trading after Q3 earnings topped the Wall Street consensus in a strong showing for the first results since the Federal Reserve lifted its asset cap on the bank.
The bank also named Charlie Scharf as chairman, in addition to his CEO role. Steven Black became lead independent director.
The bank expects 2025 net interest income to “roughly in line” with 2024’s $47.7B, unchanged from its prior guidance and compared with the Visible Alpha consensus of $47.5B. Noninterest expense is expected to be ~$54.6B, up from its previous guidance of ~$54.2B.
Q3 EPS of $1.66 vs. $1.60 in Q1 and $1.42 in last year’s Q3. The current quarter’s bottom line included $0.7 per share charge from severance expense. Excluding the items, Q3 2025 EPS came to $1.73, beating the average analyst estimate of $1.54.
Total revenue of $21.4B, beating the consensus estimate of $21.2B, increased from $20.8B in the prior quarter and $20.4B a year ago.
“Revenue grew with higher net interest income and strong, broad-based growth in fee-basedincome across both our consumer and commercial businesses,” said Chairman and CEO Charlie Scharf. “We grew our balance sheet, including the highest linked-quarter loan growth in over three years.”
Seeking Alpha analyst Steve Booyens of Pearl Gray Equity and Research observed: “Despite the global macro outlook deteriorating in recent quarters, Wells Fargo was able to deliver robust results as true risk remained low during its latest quarter. NII spreads have remained surprisingly solid, driven by lower funding rates and higher-than-estimated loan demand among consumers and corporations.”
Provision for credit losses of $681M vs. $1.01B in Q2 and $1.07B in Q3 2024.
Net interest income of $12.0B, matching the Visible Alpha consensus of $12.0B, increased from $11.7B in the previous quarter and $11.7B in last year’s Q3.
Noninterest income of $9.49B climbed from $9.11B in Q2 and $8.68B in Q3 2024.
Wells Fargo’s (NYSE:WFC) noninterest expense of $13.8B grew from $13.4B in the prior quarter and $13.1B a year ago.
Average loans were $928.7B in Q3 vs.$916.7B in Q2. Average deposits increased/fell to $1.34T from $1.33T in the previous quarter.
Q1 revenue performance by segment:
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Consumer Banking and Lending revenue of $9.65B increased 4% Q/Q and 6% Y/Y.
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Commercial Banking revenue of $3.04B grew 4% Q/Q and slid 9% Y/Y.
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Wealth and Investment Management revenue of $4.20B rose 8% Q/Q and Y/Y. Total client assets of $2.47T, up 5% Q/Q and 8% Y/Y.
Seeking Alpha analyst Booyens sees a strong outlook for Wells Fargo (NYSE:WFC): “Regarding outlook, FICC opportunities remain plentiful amid shifts in FX, rate, and commodity cycles; IB has opportunities due to ongoing support from public markets, which lowers execution risk and provides underwriting opportunities, and commendable risk-adjusted return on economic capital frees up shareholder compensation. However, as a caution, keeping an eye out on provisions would be sensible leading-forward as deterioration of the credit cycle is likely overdue.”
Conference call at 10:00 AM ET.