25% Revenue Growth Powers Record 2Q25 Results

Business Wire

5 days ago

WESTLAKE, Texas--(BUSINESS WIRE)--The Charles Schwab Corporation reported net income for the second quarter totaling $2.1 billion, or $1.08 earnings per share. Excluding $128 million of pre-tax transaction-related costs, adjusted (1) net income and earnings per share equaled $2.2 billion and $1.14, respectively.
2Q25 Client and Business Highlights
Total client assets increased 14% year-over-year to a record $10.76 trillion
Core net new assets of $80.3 billion brings year-to-date asset gathering to $218.0 billion – up 39% year-over-year
New brokerage account openings increased 11% year-over-year to 1.1 million for the quarter, helping active brokerage accounts and total client accounts reach 37.5 million and 45.2 million, respectively
Managed Investing Solutions net inflows grew 37% versus 2Q24
Margin balances ended the quarter at $83.4 billion – essentially flat quarter-over-quarter – as investors selectively increased leverage while equity markets rebounded following the disruption in early April
Daily average trading volume remained robust at 7.6 million – up 38% versus 2Q24
Charles Schwab recognized as Best Investing Platform Overall by U.S. News (3)
Charles Schwab Bank ranked #1 in J.D. Power's U.S. Direct Banking Satisfaction Study for the 7 th consecutive year (4)
Three Months Ended
June 30,
%
Six Months Ended
June 30,
%
Financial Highlights
2025
2024
Change
2025
2024
Change
Net income (in millions)
GAAP
$
2,126
$
1,332
60
%
$
4,035
$
2,694
50
%
Adjusted
$
2,222
$
1,465
52
%
$
4,230
$
2,934
44
%
Diluted earnings per common share
GAAP
$
1.08
$
.66
64
%
$
2.07
$
1.34
54
%
Adjusted
$
1.14
$
.73
56
%
$
2.17
$
1.47
48
%
Pre-tax profit margin
GAAP
47.9
%
37.2
%
45.9
%
37.6
%
Adjusted
50.1
%
41.0
%
48.2
%
40.9
%
Return on average common stockholders' equity (annualized)
19
%
14
%
18
%
15
%
Return on tangible common equity (annualized)
35
%
34
%
34
%
36
%
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Note:
Items labeled 'adjusted' are non-GAAP financial measures; further details are included on pages 10-12 of this release. All per-share results are rounded to the nearest cent, based on weighted-average diluted common shares outstanding.
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2Q25 Financial Commentary
Quarterly net revenues grew year-over-year by 25% to a record $5.9 billion
Net interest margin expanded sequentially by 12 basis points to 2.65% due primarily to the further reduction of higher cost liabilities and a rebound in securities lending activity
Client transactional sweep cash balances ended at $412.1 billion, a sequential build of $4.3 billion, reflecting tax seasonality as well as client net equity selling during the period
Bank Supplemental Funding (2) declined $10.4 billion during the quarter to $27.7 billion at June month-end
Asset management and administration fees increased by 14% year-over-year to $1.6 billion, powered by organic growth, rebounding equity markets, and sustained product utilization
Trading revenue increased 23% versus 2Q24 due to robust volumes
GAAP expenses for the quarter increased 4% year-over-year; excluding second quarter amortization of acquired intangibles of $128 million, adjusted total expenses (1) were up 5% relative to 2Q24
Capital ratios across the firm remained strong – including preliminary consolidated Tier 1 Leverage and adjusted Tier 1 Leverage (1) equaling 9.8% and 7.2%, respectively
Redeemed $2.5 billion Series G Preferred Stock
Repurchased 3.9 million shares of our common stock for $351 million during the quarter
(1)
Further details on non-GAAP financial measures and a reconciliation of such measures to GAAP reported results are included on pages 10-12 of this release.
(2)
Bank Supplemental Funding includes repurchase agreements at the banks, Schwab Bank Certificates of Deposit (CDs), and Federal Home Loan Bank balances.
(3)
U.S. News & World Report's Best Investing Platforms award was given on April 23, 2025. The criteria, evaluation, and ranking were determined by U.S. News & World Report. See https://money.usnews.com/investing/best-brokers/methodology for more information. Schwab paid a licensing fee to U.S. News & World Report for use of the award and logos.
(4)
Charles Schwab Bank received the highest score in the checking segment of the J.D. Power 2019–2025 U.S. Direct Banking Satisfaction Studies, which measures overall satisfaction with direct branchless banks. Visit https://jdpower.com/awards for more details. The J.D. Power 2025 U.S. Direct Banking Satisfaction Study is independently conducted, and the participating firms do not pay to participate. Use of study results in promotional materials is subject to a license fee.
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Summer Business Update
The company will host its Summer Business Update for institutional investors this morning from 7:30 a.m. - 8:30 a.m. CT, 8:30 a.m. - 9:30 a.m. ET.
Registration for this Update webcast is accessible at https://www.aboutschwab.com/schwabevents.
Forward-Looking Statements
This press release contains forward-looking statements relating to the company's revenue model, scale and efficiency, and capital ratios. These forward-looking statements reflect management's expectations as of the date hereof. Achievement of these expectations and objectives is subject to risks and uncertainties that could cause actual results to differ materially from the expressed expectations. Important factors that may cause such differences are described in the company's most recent reports on Form 10-K and Form 10-Q, which have been filed with the Securities and Exchange Commission and are available on the company's website (https://www.aboutschwab.com/financial-reports) and on the Securities and Exchange Commission's website (https://www.sec.gov). The company makes no commitment to update any forward-looking statements.
About Charles Schwab
The Charles Schwab Corporation (NYSE: SCHW) is a leading provider of financial services, with 37.5 million active brokerage accounts, 5.6 million workplace plan participant accounts, 2.1 million banking accounts, and $10.76 trillion in client assets. Through its operating subsidiaries, the company provides a full range of wealth management, securities brokerage, banking, asset management, custody, and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC, https://www.sipc.org), and its affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent, fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through Schwab Advisor Services. Its primary banking subsidiary, Charles Schwab Bank, SSB (member FDIC and an Equal Housing Lender), provides banking and lending services and products. More information is available at https://www.aboutschwab.com.
THE CHARLES SCHWAB CORPORATION
Financial and Operating Highlights
(Unaudited)
Q2-25 % change
2025
2024
vs.
vs.
Second
First
Fourth
Third
Second
(In millions, except per share amounts and as noted)
Q2-24
Q1-25
Quarter
Quarter
Quarter
Quarter
Quarter
Net Revenues
Net interest revenue
31
%
4
%
$
2,822
$
2,706
$
2,531
$
2,222
$
2,158
Asset management and administration fees
14
%
3
%
1,570
1,530
1,509
1,476
1,383
Trading revenue
23
%
5
%
952
908
873
797
777
Bank deposit account fees
61
%
1
%
247
245
241
152
153
Other
19
%
24
%
260
210
175
200
219
Total net revenues
25
%
5
%
5,851
5,599
5,329
4,847
4,690
Expenses Excluding Interest
Compensation and benefits
6
%
(8
)%
1,536
1,672
1,533
1,522
1,450
Professional services
12
%
8
%
291
269
297
256
259
Occupancy and equipment
9
%
(1
)%
270
274
276
271
248
Advertising and market development
1
%
13
%
108
96
101
101
107
Communications
2
%
15
%
176
153
131
147
172
Depreciation and amortization
(8
)%
(1
)%
215
217
224
231
233
Amortization of acquired intangible assets
(1
)%
(2
)%
128
130
130
130
129
Regulatory fees and assessments
(20
)%
(13
)%
77
89
89
88
96
Other
(1
)%
1
%
247
244
243
259
249
Total expenses excluding interest
4
%
(3
)%
3,048
3,144
3,024
3,005
2,943
Income before taxes on income
60
%
14
%
2,803
2,455
2,305
1,842
1,747
Taxes on income
63
%
24
%
677
546
465
434
415
Net Income
60
%
11
%
2,126
1,909
1,840
1,408
1,332
Preferred stock dividends and other
23
%
32
%
149
113
123
109
121
Net Income Available to Common Stockholders
63
%
10
%
$
1,977
$
1,796
$
1,717
$
1,299
$
1,211
Earnings per common share:
Basic
65
%
10
%
$
1.09
$
.99
$
.94
$
.71
$
.66
Diluted
64
%
9
%
$
1.08
$
.99
$
.94
$
.71
$
.66
Dividends declared per common share
8
%
—
$
.27
$
.27
$
.25
$
.25
$
.25
Weighted-average common shares outstanding:
Basic
(1
)%
—
1,817
1,817
1,831
1,829
1,828
Diluted
(1
)%
—
1,822
1,822
1,836
1,834
1,834
Performance Measures
Pre-tax profit margin
47.9
%
43.8
%
43.3
%
38.0
%
37.2
%
Return on average common stockholders' equity (annualized) (1)
19
%
18
%
18
%
14
%
14
%
Financial Condition (at quarter end, in billions)
Cash and cash equivalents
27
%
(8
)%
$
32.2
$
35.0
$
42.1
$
34.9
$
25.4
Cash and investments segregated
110
%
19
%
45.6
38.4
38.2
33.7
21.7
Receivables from brokers, dealers, and clearing organizations
34
%
48
%
4.3
2.9
2.4
3.4
3.2
Receivables from brokerage clients — net
14
%
(2
)%
82.8
84.4
85.4
74.0
72.8
Available for sale securities
(28
)%
(10
)%
67.6
74.8
83.0
90.0
93.6
Held to maturity securities
(9
)%
(3
)%
139.7
143.8
146.5
149.9
153.2
Bank loans — net
19
%
7
%
50.4
47.1
45.2
43.3
42.2
Total assets
2
%
(1
)%
458.9
462.9
479.8
466.1
449.7
Bank deposits
(8
)%
(5
)%
233.1
246.2
259.1
246.5
252.4
Payables to brokers, dealers, and clearing organizations (2)
N/M
18
%
18.6
15.7
13.3
16.4
5.9
Payables to brokerage clients
37
%
9
%
109.4
100.6
101.6
89.2
80.0
Accrued expenses and other liabilities (2)
2
%
(2
)%
10.8
11.0
12.3
11.2
10.6
Other short-term borrowings
(15
)%
23
%
8.5
6.9
6.0
10.6
10.0
Federal Home Loan Bank borrowings
(63
)%
(22
)%
9.0
11.5
16.7
22.6
24.4
Long-term debt
(10
)%
(6
)%
20.2
21.5
22.4
22.4
22.4
Total liabilities
1
%
(1
)%
409.5
413.4
431.5
418.8
405.7
Stockholders' equity
13
%
—
49.5
49.5
48.4
47.2
44.0
Total liabilities and stockholders' equity
2
%
(1
)%
458.9
462.9
479.8
466.1
449.7
Other
Full-time equivalent employees (at quarter end, in thousands)
1
%
2
%
32.6
32.1
32.1
32.1
32.3
Capital expenditures — purchases of equipment, office facilities, and property,
net (in millions)
48
%
(13
)%
$
136
$
156
$
258
$
135
$
92
Expenses excluding interest as a percentage of average client assets (annualized)
0.12
%
0.12
%
0.12
%
0.12
%
0.13
%
Clients' Daily Average Trades (DATs) (in thousands)
38
%
2
%
7,571
7,391
6,312
5,697
5,486
Number of Trading Days
(2
)%
3
%
62.0
60.0
63.0
63.5
63.0
Expand
(1)
Return on average common stockholders' equity is calculated using net income available to common stockholders divided by average common stockholders' equity.
(2)
Beginning in the fourth quarter of 2024, payables to brokers, dealers, and clearing organizations are presented separately from accrued expenses and other liabilities. Prior period amounts have been reclassified to reflect this change. Payables to brokers, dealers, and clearing organizations include securities loaned.
(3)
Revenue per trade is calculated as trading revenue divided by the product of DATs multiplied by the number of trading days.
N/M Not meaningful. Percentage changes greater than 200% are presented as not meaningful.
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THE CHARLES SCHWAB CORPORATION
Net Interest Revenue Information
(In millions, except ratios or as noted)
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
2025
2024
2025
2024
Average
Balance
Interest
Revenue/
Expense
Average
Yield/
Rate
Average
Balance
Interest
Revenue/
Expense
Average
Yield/
Rate
Average
Balance
Interest
Revenue/
Expense
Average
Yield/
Rate
Average
Balance
Interest
Revenue/
Expense
Average
Yield/
Rate
Interest-earning assets
Cash and cash equivalents
$
28,000
$
305
4.30
%
$
28,839
$
382
5.24
%
$
29,236
$
633
4.30
%
$
31,394
$
836
5.26
%
Cash and investments segregated
47,574
506
4.20
%
21,493
281
5.17
%
43,117
918
4.23
%
25,503
669
5.19
%
Receivables from brokerage clients
79,616
1,332
6.62
%
68,715
1,351
7.78
%
81,367
2,714
6.63
%
66,259
2,611
7.80
%
Available for sale securities (1)
77,750
405
2.08
%
104,045
555
2.13
%
81,151
838
2.06
%
107,956
1,149
2.12
%
Held to maturity securities (1)
141,098
602
1.70
%
154,314
658
1.70
%
142,740
1,224
1.71
%
155,862
1,348
1.73
%
Bank loans
48,691
518
4.27
%
41,562
460
4.44
%
47,374
1,011
4.29
%
41,046
900
4.40
%
Total interest-earning assets
422,729
3,668
3.45
%
418,968
3,687
3.50
%
424,985
7,338
3.44
%
428,020
7,513
3.49
%
Securities lending revenue
96
95
156
171
Other interest revenue
23
35
50
74
Total interest-earning assets
$
422,729
$
3,787
3.56
%
$
418,968
$
3,817
3.62
%
$
424,985
$
7,544
3.54
%
$
428,020
$
7,758
3.60
%
Funding sources
Bank deposits
$
237,645
$
326
0.55
%
$
258,119
$
840
1.31
%
$
241,660
$
762
0.64
%
$
266,243
$
1,761
1.33
%
Payables to brokers, dealers, and
clearing organizations (2)
16,657
167
3.97
%
5,642
57
3.98
%
15,424
304
3.93
%
5,577
112
3.97
%
Payables to brokerage clients
92,425
69
0.30
%
67,680
77
0.45
%
91,305
120
0.27
%
68,011
150
0.44
%
Other short-term borrowings
7,644
87
4.55
%
9,268
129
5.59
%
7,172
169
4.74
%
8,327
232
5.60
%
Federal Home Loan Bank borrowings
9,753
110
4.48
%
25,582
348
5.42
%
10,236
243
4.72
%
25,220
678
5.35
%
Long-term debt
20,624
206
3.94
%
22,460
208
3.70
%
21,448
418
3.87
%
23,730
432
3.64
%
Total interest-bearing liabilities (2)
384,748
965
1.00
%
388,751
1,659
1.71
%
387,245
2,016
1.04
%
397,108
3,365
1.70
%
Non-interest-bearing funding sources (2)
37,981
30,217
37,740
30,912
Other interest expense
—
—
—
2
Total funding sources
$
422,729
$
965
0.91
%
$
418,968
$
1,659
1.59
%
$
424,985
$
2,016
0.95
%
$
428,020
$
3,367
1.57
%
Net interest revenue
$
2,822
2.65
%
$
2,158
2.03
%
$
5,528
2.59
%
$
4,391
2.03
%
Expand
(1)
Amounts have been calculated based on amortized cost.
(2)
Beginning in the fourth quarter of 2024, payables to brokers, dealers, and clearing organizations is presented separately from non-interest-bearing funding sources and included in total interest-bearing liabilities. This line item includes securities loaned and related interest expense. Prior period amounts have been reclassified to reflect this change.
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(1)
Managed investing solutions includes managed portfolios, specialized strategies, and customized investment advice such as Schwab Wealth Advisory TM, Schwab Managed Portfolios TM, Managed Account Select ®, Schwab Advisor Network ®, Windhaven Strategies ®, ThomasPartners ® Strategies, Wasmer Schroeder TM Strategies, Schwab Index Advantage advised retirement plan balances, Schwab Intelligent Portfolios ®, Institutional Intelligent Portfolios ®, Schwab Intelligent Portfolios Premium ®, AdvisorDirect ®, Essential Portfolios, Selective Portfolios, and Personalized Portfolios; as well as legacy non-fee managed investing solutions including Schwab Advisor Source and certain retirement plan balances. Average client assets for managed investing solutions may also include the asset balances contained in the mutual fund and/or ETF categories listed above. For the total end of period view, please see the Monthly Activity Report.
(2)
Includes various asset-related fees, such as trust fees, 401(k) recordkeeping fees, and mutual fund clearing fees and other service fees.
(3)
Includes miscellaneous service and transaction fees relating to mutual funds and ETFs that are not balance-based.
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THE CHARLES SCHWAB CORPORATION
Growth in Client Assets and Accounts
(Unaudited)
Q2-25 % Change
2025
2024
vs.
vs.
Second
First
Fourth
Third
Second
(In billions, at quarter end, except as noted)
Q2-24
Q1-25
Quarter
Quarter
Quarter
Quarter
Quarter
Assets in client accounts
Schwab One ®, certain cash equivalents, and bank deposits
4
%
(1
)%
$
342.7
$
345.2
$
358.8
$
334.1
$
330.7
Bank deposit account balances
(3
)%
(2
)%
82.1
83.7
87.5
84.0
84.5
Proprietary mutual funds (Schwab Funds ® and Laudus Funds ®) and CTFs
Money market funds (1)
22
%
2
%
653.5
641.5
596.5
562.1
533.6
Equity and bond funds and CTFs (2)
16
%
10
%
249.7
227.0
232.2
228.9
214.4
Total proprietary mutual funds and CTFs
21
%
4
%
903.2
868.5
828.7
791.0
748.0
Mutual Fund Marketplace ® (3)
Mutual Fund OneSource ® and other no-transaction-fee funds
32
%
33
%
453.9
340.3
347.8
358.0
344.8
Mutual fund clearing services
13
%
6
%
298.3
280.6
280.7
280.8
264.7
Other third-party mutual funds
(1
)%
(2
)%
1,168.5
1,195.4
1,211.1
1,236.5
1,177.5
Total Mutual Fund Marketplace
7
%
6
%
1,920.7
1,816.3
1,839.6
1,875.3
1,787.0
Total mutual fund assets
11
%
5
%
2,823.9
2,684.8
2,668.3
2,666.3
2,535.0
Exchange-traded funds
Proprietary ETFs (2)
26
%
10
%
439.7
398.2
395.0
385.9
349.6
Other third-party ETFs
25
%
11
%
2,175.6
1,960.1
1,940.6
1,888.2
1,738.6
Total ETF assets
25
%
11
%
2,615.3
2,358.3
2,335.6
2,274.1
2,088.2
Equity and other securities
15
%
11
%
4,188.7
3,765.5
3,972.6
3,839.6
3,648.8
Fixed income securities
(1
)%
2
%
788.0
775.8
762.3
795.4
792.0
Margin loans outstanding
16
%
—
(83.4
)
(83.6
)
(83.8
)
(73.0
)
(71.7
)
Total client assets
14
%
8
%
$
10,757.3
$
9,929.7
$
10,101.3
$
9,920.5
$
9,407.5
Client assets by business (4)
Investor Services (5)
14
%
9
%
$
6,069.9
$
5,557.4
$
5,721.6
$
5,576.7
$
5,317.5
Advisor Services (6)
15
%
7
%
4,687.4
4,372.3
4,379.7
4,343.8
4,090.0
Total client assets
14
%
8
%
$
10,757.3
$
9,929.7
$
10,101.3
$
9,920.5
$
9,407.5
Net growth in assets in client accounts (for the quarter ended)
Net new assets by business (4)
Investor Services (5)
(22
)%
(55
)%
$
31.2
$
69.5
$
46.2
$
37.2
$
40.1
Advisor Services (6)
24
%
(33
)%
42.4
62.9
62.2
53.6
34.1
Total net new assets
(1
)%
(44
)%
$
73.6
$
132.4
$
108.4
$
90.8
$
74.2
Net market gains (losses)
754.0
(304.0
)
72.4
422.2
214.9
Net growth (decline)
$
827.6
$
(171.6
)
$
180.8
$
513.0
$
289.1
New brokerage accounts (in thousands, for the quarter ended)
11
%
(7
)%
1,098
1,183
1,119
972
985
Client accounts (in thousands)
Active brokerage accounts
5
%
1
%
37,476
37,011
36,456
35,982
35,612
Banking accounts
9
%
2
%
2,096
2,050
1,998
1,954
1,931
Workplace Plan Participant Accounts (7)
4
%
2
%
5,586
5,495
5,399
5,388
5,363
Expand
(1)
Total client assets in purchased money market funds are located at: https://www.aboutschwab.com/investor-relations.
(2)
Includes balances held on and off the Schwab platform. As of June 30, 2025, off-platform equity and bond funds, CTFs, and ETFs were $38.0 billion, $4.5 billion, and $156.9 billion, respectively.
(3)
Excludes all proprietary mutual funds and ETFs.
(4)
In the fourth quarter of 2024, Retirement Business Services moved from Advisor Services to Investor Services. Prior periods have been recast.
(5)
Second quarter of 2025 includes net outflows of $6.7 billion from off-platform Schwab Bank Retail CDs. First quarter of 2025 includes net outflows of $5.3 billion from off-platform Schwab Bank Retail CDs. Fourth quarter of 2024 includes net outflows of $5.5 billion from off-platform Schwab Bank Retail CDs and an outflow of $0.6 billion from a large international relationship. Third quarter of 2024 includes net outflows of $4.4 billion from off-platform Schwab Bank Retail CDs and an outflow of $0.1 billion from a large international relationship. Second quarter of 2024 includes net inflows of $2.7 billion from off-platform Schwab Bank Retail CDs and an inflow of $10.3 billion from a mutual fund clearing services client.
(6)
Fourth quarter of 2024 includes an outflow of $0.3 billion from a large international relationship.
(7)
Includes Retirement Plan Services, Stock Plan Services, Designated Brokerage Services, and Retirement Business Services. Participants may be enrolled in services in more than one Workplace business.
Expand
The Charles Schwab Corporation Monthly Activity Report For June 2025
2024
2025
Change
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Mo.
Yr.
Market Indices (at month end)
Dow Jones Industrial Average ®
39,119
40,843
41,563
42,330
41,763
44,911
42,544
44,545
43,841
42,002
40,669
42,270
44,095
4
%
13
%
Nasdaq Composite ®
17,733
17,599
17,714
18,189
18,095
19,218
19,311
19,627
18,847
17,299
17,446
19,114
20,370
7
%
15
%
Standard & Poor's ® 500
5,460
5,522
5,648
5,762
5,705
6,032
5,882
6,041
5,955
5,612
5,569
5,912
6,205
5
%
14
%
Client Assets (in billions of dollars)
Beginning Client Assets
9,206.3
9,407.5
9,572.1
9,737.7
9,920.5
9,852.0
10,305.4
10,101.3
10,333.1
10,280.2
9,929.7
9,892.2
10,349.0
Net New Assets (1)
33.2
29.0
31.5
30.3
22.7
25.5
60.2
30.5
46.6
55.3
1.1
33.6
38.9
16
%
17
%
Net Market Gains (Losses)
168.0
135.6
134.1
152.5
(91.2
)
427.9
(264.3
)
201.3
(99.5
)
(405.8
)
(38.6
)
423.2
369.4
Total Client Assets (at month end)
9,407.5
9,572.1
9,737.7
9,920.5
9,852.0
10,305.4
10,101.3
10,333.1
10,280.2
9,929.7
9,892.2
10,349.0
10,757.3
4
%
14
%
Core Net New Assets (1,2)
29.1
29.0
32.8
33.5
24.6
28.8
61.4
30.6
48.0
59.1
2.7
35.0
42.6
22
%
46
%
Receiving Ongoing Advisory Services (at month end)
Investor Services
632.9
649.1
663.7
675.1
665.6
688.9
682.0
698.7
703.5
688.8
688.2
711.2
737.6
4
%
17
%
Advisor Services
4,090.0
4,185.4
4,268.1
4,343.8
4,303.3
4,489.2
4,379.7
4,496.6
4,493.2
4,372.3
4,353.0
4,525.6
4,687.4
4
%
15
%
Client Accounts (at month end, in thousands)
Active Brokerage Accounts
35,612
35,743
35,859
35,982
36,073
36,222
36,456
36,709
36,861
37,011
37,254
37,375
37,476
—
5
%
Banking Accounts
1,931
1,937
1,940
1,954
1,967
1,980
1,998
2,019
2,033
2,050
2,066
2,077
2,096
1
%
9
%
Workplace Plan Participant Accounts (3)
5,363
5,382
5,373
5,388
5,407
5,393
5,399
5,450
5,464
5,495
5,518
5,563
5,586
—
4
%
Client Activity
New Brokerage Accounts (in thousands)
310
327
324
321
331
357
431
433
362
388
439
336
323
(4
)%
4
%
Client Cash as a Percentage of Client Assets (4)
9.7
%
9.6
%
9.5
%
9.5
%
9.8
%
9.5
%
10.1
%
9.8
%
10.0
%
10.6
%
10.5
%
10.1
%
9.9
%
(20) bp
20 bp
Derivative Trades as a Percentage of Total Trades
21.3
%
21.2
%
20.8
%
21.5
%
21.4
%
19.7
%
18.6
%
19.3
%
19.9
%
19.5
%
18.4
%
21.0
%
20.8
%
(20) bp
(50) bp
Selected Average Balances (in millions of dollars)
Average Interest-Earning Assets (5)
417,150
417,379
420,191
420,203
422,327
425,789
431,177
431,523
424,805
425,228
430,884
419,638
417,768
—
—
Average Margin Balances
69,730
73,206
73,326
72,755
74,105
76,932
81,507
82,551
84,233
82,725
77,478
79,132
82,339
4
%
18
%
Average Bank Deposit Account Balances (6)
85,195
83,979
82,806
82,336
83,261
84,385
85,384
84,790
83,089
84,302
84,060
81,495
81,014
(1
)%
(5
)%
Mutual Funds and Exchange-Traded Funds
Net Buys (Sells) (7,8) (in millions of dollars)
Equities
3,379
10,908
5,609
5,217
7,176
13,226
14,805
10,050
4,987
(1,221
)
7,950
10,473
8,987
Hybrid
(843
)
(1,155
)
(1,377
)
(432
)
(1,397
)
(329
)
124
(1,324
)
(464
)
(603
)
(1,663
)
(287
)
(1,038
)
Bonds
6,346
8,651
10,919
11,015
10,442
7,473
10,969
8,747
12,162
11,438
(1,490
)
8,483
6,050
Net Buy (Sell) Activity (in millions of dollars)
Mutual Funds (7)
(4,254
)
(4,679
)
(4,003
)
(1,261
)
(4,905
)
(4,492
)
(4,331
)
(6,785
)
(3,971
)
(8,537
)
(13,955
)
(3,224
)
(5,351
)
Exchange-Traded Funds (8)
13,136
23,083
19,154
17,061
21,126
24,862
30,229
24,258
20,656
18,151
18,752
21,893
19,350
Money Market Funds
3,858
9,110
8,048
9,672
11,032
9,172
8,956
11,584
12,306
14,586
(6,158
)
5,794
5,814
Expand
Note: Certain supplemental details related to the information above can be found at: https://www.aboutschwab.com/financial-reports.
(1)
Unless otherwise noted, differences between net new assets and core net new assets are net flows from off-platform Schwab Bank Retail CDs. 2024 also includes outflows from a large international relationship of $0.1 billion in August, $0.3 billion in October, and $0.6 billion in November.
(2)
Net new assets before significant one-time inflows or outflows, such as acquisitions/divestitures or extraordinary flows (generally greater than $25 billion beginning in 2025; $10 billion in prior periods) relating to a specific client, and activity from off-platform Schwab Bank Retail CDs. These flows may span multiple reporting periods.
(3)
Includes Retirement Plan Services, Stock Plan Services, Designated Brokerage Services, and Retirement Business Services. Participants may be enrolled in services in more than one Workplace business.
(4)
Schwab One ®, certain cash equivalents, bank deposits, third-party bank deposit accounts, and money market fund balances as a percentage of total client assets; client cash excludes brokered CDs issued by Charles Schwab Bank.
(5)
Represents average total interest-earning assets on the Company's balance sheet.
(6)
Represents average clients' uninvested cash sweep account balances held in deposit accounts at third-party financial institutions.
(7)
Represents the principal value of client mutual fund transactions handled by Schwab, including transactions in proprietary funds. Includes institutional funds available only to investment managers. Excludes money market fund transactions.
(8)
Represents the principal value of client ETF transactions handled by Schwab, including transactions in proprietary ETFs.
Expand
THE CHARLES SCHWAB CORPORATION
Non-GAAP Financial Measures
(In millions, except ratios and per share amounts)
(Unaudited)
In addition to disclosing financial results in accordance with generally accepted accounting principles in the U.S. (GAAP), Schwab's second quarter earnings release contains references to the non-GAAP financial measures described below. We believe these non-GAAP financial measures provide useful supplemental information about the financial performance of the Company, and facilitate meaningful comparison of Schwab's results in the current period to both historic and future results. These non-GAAP measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may not be comparable to non-GAAP financial measures presented by other companies.
Schwab's use of non-GAAP measures is reflective of certain adjustments made to GAAP financial measures as described below.
Non-GAAP Adjustment or Measure
Definition
Usefulness to Investors and Uses by Management
Acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs
Schwab adjusts certain GAAP financial measures to exclude the impact of acquisition and integration-related costs incurred as a result of the Company's acquisitions, amortization of acquired intangible assets, restructuring costs, and, where applicable, the income tax effect of these expenses.
Adjustments made to exclude amortization of acquired intangible assets are reflective of all acquired intangible assets, which were recorded as part of purchase accounting. These acquired intangible assets contribute to the Company's revenue generation. Amortization of acquired intangible assets will continue in future periods over their remaining useful lives.
We exclude acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs for the purpose of calculating certain non-GAAP measures because we believe doing so provides additional transparency of Schwab's ongoing operations, and is useful in both evaluating the operating performance of the business and facilitating comparison of results with prior and future periods.
Costs related to acquisition and integration or restructuring fluctuate based on the timing of acquisitions, integration and restructuring activities, thereby limiting comparability of results among periods, and are not representative of the costs of running the Company's ongoing business. Amortization of acquired intangible assets is excluded because management does not believe it is indicative of the Company's underlying operating performance.
Return on tangible common equity
Return on tangible common equity represents annualized adjusted net income available to common stockholders as a percentage of average tangible common equity. Tangible common equity represents common equity less goodwill, acquired intangible assets — net, and related deferred tax liabilities.
Acquisitions typically result in the recognition of significant amounts of goodwill and acquired intangible assets. We believe return on tangible common equity may be useful to investors as a supplemental measure to facilitate assessing capital efficiency and returns relative to the composition of Schwab's balance sheet.
Adjusted Tier 1 Leverage Ratio
Adjusted Tier 1 Leverage Ratio represents the Tier 1 Leverage Ratio as prescribed by bank regulatory guidance for the consolidated company and for Charles Schwab Bank, SSB (CSB), adjusted to reflect the inclusion of accumulated other comprehensive income (AOCI) in the ratio.
Inclusion of the impacts of AOCI in the Company's Tier 1 Leverage Ratio provides additional information regarding the Company's current capital position. We believe Adjusted Tier 1 Leverage Ratio may be useful to investors as a supplemental measure of the Company's capital levels.
Expand
The Company also uses adjusted diluted EPS and return on tangible common equity as components of performance criteria for employee bonus and certain executive management incentive compensation arrangements. The Compensation Committee of CSC's Board of Directors maintains discretion in evaluating performance against these criteria. Additionally, the Company uses adjusted Tier 1 Leverage Ratio in managing capital, including its use of the measure as its long-term operating objective.
THE CHARLES SCHWAB CORPORATION
Non-GAAP Financial Measures
(In millions, except ratios and per share amounts)
(Unaudited)
The tables below present reconciliations of GAAP measures to non-GAAP measures:
Three Months Ended June 30,
Six Months Ended June 30,
2025
2024
2025
2024
Total
Expenses
Excluding
Interest
Net
Income
Total
Expenses
Excluding
Interest
Net
Income
Total
Expenses
Excluding
Interest
Net
Income
Total
Expenses Excluding
Interest
Net
Income
Total expenses excluding interest (GAAP), Net income (GAAP)
$
3,048
$
2,126
$
2,943
$
1,332
$
6,192
$
4,035
$
5,885
$
2,694
Amortization of acquired intangible assets
(128
)
128
(129
)
129
(258
)
258
(259
)
259
Acquisition and integration-related costs (1)
—
—
(36
)
36
—
—
(74
)
74
Restructuring costs (2)
—
—
(10
)
10
—
—
18
(18
)
Income tax effects (3)
N/A
(32
)
N/A
(42
)
N/A
(63
)
N/A
(75
)
Adjusted total expenses (non-GAAP), Adjusted net income (non-GAAP)
$
2,920
$
2,222
$
2,768
$
1,465
$
5,934
$
4,230
$
$
2,934
Expand
(1)
There were no acquisition and integration-related costs for the three and six months ended June 30, 2025. Acquisition and integration-related costs for the three and six months ended June 30, 2024 primarily consist of $18 million and $35 million of compensation and benefits, $12 million and $29 million of professional services, and $5 million of depreciation and amortization.
(2)
There were no restructuring costs for the three and six months ended June 30, 2025. Restructuring costs for the three and six months ended June 30, 2024 reflect a benefit due to a change in estimate of $3 million and $34 million in compensation and benefits, offset by $1 million and $3 million of occupancy and equipment expense and $12 million and $13 million of other expense.
(3)
The income tax effects of the non-GAAP adjustments are determined using an effective tax rate reflecting the exclusion of non-deductible acquisition costs and are used to present the acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs on an after-tax basis.
N/A Not applicable.
Expand
Three Months Ended June 30,
Six Months Ended June 30,
2025
2024
2025
2024
Amount
% of
Total Net
Revenues
Amount
% of
Total Net
Revenues
Amount
% of
Total Net
Revenues
Amount
% of
Total Net
Revenues
Income before taxes on income (GAAP), Pre-tax profit margin (GAAP)
$
2,803
47.9
%
$
1,747
37.2
%
$
5,258
45.9
%
$
3,545
37.6
%
Amortization of acquired intangible assets
128
2.2
%
129
2.8
%
258
2.3
%
259
2.7
%
Acquisition and integration-related costs
—
—
36
0.8
%
—
—
74
0.8
%
Restructuring costs
—
—
10
0.2
%
—
—
(18
)
(0.2
)%
Adjusted income before taxes on income (non-GAAP), Adjusted pre-tax profit margin (non-GAAP)
$
2,931
50.1
%
$
1,922
41.0
%
$
5,516
48.2
%
$
3,860
40.9
%
Expand
Three Months Ended June 30,
Six Months Ended June 30,
2025
2024
2025
2024
Amount
Diluted
EPS
Amount
Diluted
EPS
Amount
Diluted
EPS
Amount
Diluted
EPS
Net income available to common stockholders (GAAP), Earnings per common share — diluted (GAAP)
$
1,977
$
1.08
$
1,211
$
.66
$
3,773
$
2.07
$
2,462
$
1.34
Amortization of acquired intangible assets
128
.07
129
.07
258
.14
259
.14
Acquisition and integration-related costs
—
—
36
.02
—
—
74
.04
Restructuring costs
—
—
10
.01
—
—
(18
)
(.01
)
Income tax effects
(32
)
(.01
)
(42
)
(.03
)
(63
)
(.04
)
(75
)
(.04
)
Adjusted net income available to common stockholders (non-GAAP), Adjusted diluted EPS (non-GAAP)
$
2,073
$
1.14
$
1,344
$
.73
$
3,968
$
2.17
$
2,702
$
1.47
Expand
THE CHARLES SCHWAB CORPORATION
Non-GAAP Financial Measures
(In millions, except ratios and per share amounts)
(Unaudited)
Three Months Ended June 30,
Six Months Ended June 30,
2025
2024
2025
2024
Return on average common stockholders' equity (GAAP)
19
%
14
%
18
%
15
%
Average common stockholders' equity
$
41,504
$
33,991
$
40,936
$
33,264
Less: Average goodwill
(11,951
)
(11,951
)
(11,951
)
(11,951
)
Less: Average acquired intangible assets — net
(7,551
)
(8,067
)
(7,615
)
(8,132
)
Plus: Average deferred tax liabilities related to goodwill and acquired intangible assets — net
1,710
1,747
1,716
1,753
Average tangible common equity
$
23,712
$
15,720
$
23,086
$
14,934
Adjusted net income available to common stockholders (1)
$
2,073
$
1,344
$
3,968
$
2,702
Return on tangible common equity (non-GAAP)
35
%
34
%
34
%
36
%
Expand
(1)
See table above for the reconciliation of net income available to common stockholders to adjusted net income available to common stockholders (non-GAAP).
Expand
(Preliminary)
June 30, 2025
CSC
CSB
Tier 1 Leverage Ratio (GAAP)
9.8
%
12.2
%
Tier 1 Capital
$
44,267
$
32,114
Plus: AOCI adjustment
(12,589
)
(10,932
)
Adjusted Tier 1 Capital
31,678
21,182
Average assets with regulatory adjustments
451,314
264,107
Plus: AOCI adjustment
(13,231
)
(11,623
)
Adjusted average assets with regulatory adjustments
$
438,083
$
252,484
Adjusted Tier 1 Leverage Ratio (non-GAAP)
7.2
%
8.4
%
Expand