Charles Schwab (SCHW) kicked off 2025 with a record-breaking first quarter, showcasing robust momentum across key financial and operational areas. Net revenues surged 18% year-over-year to a new high of $5.6 billion, while GAAP net income climbed 40% to $1.91 billion. On an adjusted basis, net income reached $2.01 billion, up 37%, and adjusted earnings per share rose 41% to $1.04. Profitability also improved notably, with the adjusted pre-tax profit margin expanding to 46.2%, a sharp increase from 40.9% a year earlier.

Client engagement remained strong, highlighted by $137.7 billion in core net new assets, a 44% YoY increase, pushing total client assets to $9.93 trillion. Schwab also opened 1.2 million new brokerage accounts, bringing the total to 37.0 million, while managed investing solutions recorded record net inflows, up 15%. Trading activity picked up, with daily average trades up 17% quarter-over-quarter, and trading revenue rising 11% YoY to $908 million.

On the balance sheet, Schwab continued its strategic deleveraging, reducing supplemental bank funding by $11.8 billion, a 46% YoY decline, to $38.1 billion. Stockholders’ equity increased 17% YoY to $49.5 billion, and client sweep cash ended the quarter at $407.8 billion, down slightly due to typical seasonal trends and market-driven client behavior. Capital strength remained solid, with a Tier 1 leverage ratio of 9.9% (GAAP) and 12.1% at Schwab Bank.

Schwab continued returning capital to shareholders, raising its common dividend by 8% to $0.27 per share and repurchasing 19.2 million shares for $1.5 billion, including participation in TD Bank’s secondary offering.

Expense discipline was evident, with total expenses excluding interest up just 7% YoY, and the expense ratio staying low at 0.12%. Management reaffirmed its commitment to long-term growth, highlighting ongoing investments in technology, advisor capabilities, and client service. CEO Rick Wurster emphasized Schwab’s ability to thrive in a volatile environment by deepening client relationships and driving innovation, while CFO Mike Verdeschi pointed to balance sheet optimization and enhanced shareholder returns.

Looking ahead, Schwab expects full-year 2025 revenue growth of 13–15%, with continued funding reductions and margin expansion. Adjusted pre-tax profit margins are forecast to approach 50%, and adjusted EPS is projected between $4.10 and $4.20, representing 25–30% growth. With strong financials, strategic execution, and ongoing investments, Schwab remains well-positioned to meet its long-term targets and deliver sustained value to shareholders.