Charles Schwab (SCHW) Q3 2024 earnings summary

Executive summary

• Total client assets reached a record $9.92 trillion, up 27% year-over-year, with core net new assets of $95.3 billion in Q3, a 109% increase year-over-year.

• Net income for Q3 2024 was $1.4 billion, up 25% year-over-year; diluted EPS rose 27% to $0.71; adjusted diluted EPS was $0.77.

• Achieved sequential earnings and revenue growth in Q3 2024, supported by strong client engagement, diversified business model, and successful Ameritrade client conversion completed in May 2024.

• Strategic initiatives advanced, focusing on scale, efficiency, monetization, client segmentation, and client experience.

• The Federal Reserve cut rates by 50 bps in September, boosting equity markets and client engagement.

Financial highlights

• Net revenues for Q3 2024 were $4.85 billion, up 5% year-over-year and 3% sequentially.

• Adjusted pre-tax profit margin rose to 41.2% from 38.0% in the prior quarter.

• Adjusted EPS reached $0.77, up from $0.71 GAAP EPS; adjusted net income was $1.5 billion.

• Managed investing net flows totaled $15.1B in Q3, up 80% year-over-year.

• Margin balances ended Q3 at $73.0B, up 17% since December 2023.

Outlook and guidance

• Full-year 2024 revenue expected to grow 2–3% versus prior year; adjusted expenses for 2024 expected to grow ~2% year-over-year.

• Net interest margin projected to expand into the 220s bps for Q4, driven by lower funding costs.

• Adjusted EPS for Q4 2024 anticipated in the upper $0.80s range.

• Management expects continued asset gathering momentum and strong client interest in wealth solutions, supported by a diversified operating model and improving capital ratios.

• 2025 outlook shaped by macro environment, interest rates, and client engagement; NIM expected to continue expanding.