TD Bank (TD) Q1 2025 earnings summary

Executive summary

• Adjusted net income for Q1 2025 was $3,623 million, nearly flat year-over-year; reported net income was $2,793 million, reflecting U.S. balance sheet restructuring and higher expenses.

• Adjusted diluted EPS was $2.02, up 1% year-over-year; reported diluted EPS was $1.55, unchanged from Q1 2024.

• Record revenue achieved in Canadian Personal & Commercial Banking, Wealth Management, and Wholesale Banking segments.

• Strategic review and U.S. AML remediation remain top priorities, with significant progress and ongoing investments.

• Sale of the 10.1% Schwab stake completed, with proceeds supporting share buybacks and organic growth investments; expected $8.6 billion net gain in Q2 2025.

Financial highlights

• Total adjusted revenue was $15,030 million, up from $13,771 million in Q1 2024; adjusted PTPP grew 5.7% year-over-year.

• Expenses increased 12% year-over-year on an adjusted basis, with about one-third due to variable compensation and FX; expense growth for 2025 expected at 5%-7%.

• CET1 ratio at quarter-end was 13.1%; pro forma for Schwab sale and $8B buyback, CET1 would be ~14.2%.

• Provision for credit losses was $1,212 million (50 bps), up $211 million year-over-year, mainly in U.S. Cards.

• Adjusted ROE was 13.2%; adjusted efficiency ratio (net of ISE) was 59.0%.

Outlook and guidance

• Expense growth for fiscal 2025 expected in the 5-7% range, with moderation in the second half after elevated Q1 and Q2 levels.

• U.S. balance sheet restructuring to be completed by mid-2025, with expected net interest income benefit at the upper end of US$300–500 million pre-tax.

• U.S. AML remediation and related investments expected to total approximately US$500 million pre-tax in fiscal 2025.

• NIM in Canadian banking expected to remain relatively stable in Q2 2025; U.S. NIM anticipated to expand as restructuring continues.

• Revised strategy and financial targets to be presented at Investor Day in 2025.