Schwab Posts Record Revenue and a Record $190 Billion in New Assets, but the Stock Slips as Revenue Lands a Hair Below Estimates

Charles Schwab (SCHW) reported record revenue and earnings for the third quarter on Thursday, led by a record $190.4 billion of core net new assets and a sharp rise in margin lending. Adjusted earnings beat estimates, but revenue of $7.17 billion came in a touch under forecasts, and the stock traded lower before the open. Management also said full-year operating leverage will be about double what it planned at the start of the year.

The quarter

Revenue grew faster than expenses, which widened the adjusted pre-tax margin by about 3.5 percentage points. Schwab said bank deposit account fees rose 40% as net yield improved. Schwab also opened 1.2 million new brokerage accounts, bringing client accounts to 48.6 million.

Record asset gathering and borrowing

Schwab bought back 4.7 million shares for about $500 million in the quarter and declared a dividend of $0.32 a share, up 19% from a year ago. Of the margin balances, about $60.7 billion relates to long/short strategies. Wealth Advisory net flows rose 55% from a year earlier, and Schwab serves more than 16,000 independent advisory firms with $5.8 trillion in assets, according to management.

Outlook: operating leverage doubles, 2027 detail in January

For 2026, management expects revenue and net interest margin growth toward the lower end of the ranges it gave at its summer business update, with expenses at the low end of the prior range. It now expects about 800 basis points of positive operating leverage, "roughly double what we expected at the beginning of the year." It also guided to net interest margin expansion of roughly 25 to 30 basis points from a year earlier in the fourth quarter, according to an earnings call summary from Investing.com. A detailed 2027 scenario will come at the Winter Business Update in January, and management reiterated its framework of mid-teens earnings growth through the cycle.

AI: a new assistant, and a gate on outside agents

Schwab named its AI-powered conversational assistant for retail clients "Charley" and announced a partnership with Anthropic to bring Claude for Financial Advisors to the independent advisors it serves. On the call, management said it is blocking unauthorized AI agents that try to log in on clients' behalf, while letting clients connect their own AI models through a secure interface, with a pilot on its thinkorswim platform. Money movement and other higher-risk actions will stay off limits to those models. Management said developer productivity is up about 25% from internal AI use. For a similar story in software, see our Workday report.

The stock

SCHW closed Wednesday at $96.80 and fell about 4% to roughly $93 in premarket trading, according to Investing.com and Benzinga. That leaves it roughly 19% below its 52-week high of $114.53. We did not have a regular-session quote at the time of writing, so check live prices. Schwab's results follow the bank reports covered in our big-bank recap.