KeyCorp (KEY) Q4 2025 earnings summary

Executive summary

• Fourth quarter 2025 earnings per share were $0.43, with net income of $474 million and adjusted EPS of $0.41; full-year record revenue increased 16% year-over-year, with net interest income and fee revenue both surpassing projections.

• Tangible book value per share grew 3% sequentially and 18% year-over-year.

• Asset quality improved, with net charge-offs, NPAs, criticized loans, and delinquencies all declining sequentially.

• $200 million of common stock was repurchased in Q4 2025, double the original commitment, and total shareholder return for 2025 was 26%, ranking #2 among peers.

• Board changes include the nomination of two new directors, a transition in the lead independent director role, and retirements.

Financial highlights

• Adjusted Q4 2025 EPS was $0.41; tax-equivalent net interest income rose 15% year-over-year, and net interest margin reached 2.82%, up 7 bps sequentially.

• Non-interest income increased 8% year-over-year, with broad-based growth in fee-based businesses; noninterest income for Q4 2025 was $782 million, up 11.4% sequentially.

• Tangible book value per share rose 18% year-over-year.

• Full-year expenses grew 4.6%, generating 1,200 basis points of operating leverage and 44% PP&R growth.

• Commercial & industrial (C&I) loans grew 9% year-over-year; client deposits increased 2%.

Outlook and guidance

• Revenue expected to rise 7-10% in 2026, with net interest income up 3-10% and non-interest income up 3-6%.

• Net interest margin expected to exit 2026 at 3.00-3.05%.

• Expenses projected to grow 3-4%, about half the rate of revenue growth, implying 300-400 basis points of positive operating leverage.

• Average loans expected to grow 1-2%, with commercial loans up about 5%.

• Targeting a 15%+ return on tangible common equity by year-end 2027, with a long-term target of 16-19%.