Schwab’s Record Revenue Showcases Wall Street Bonanza From Trade Tumult, AI Revolution

Growing up, Charles R. Schwab says he did “everything” he could to make money after school and during the summers. He sold ice cream, mowed lawns and caddied at Santa Barbara’s Montecito Country Club, where he taught himself to golf, foreshadowing the meetings on the links in his future business career. On Thursday, “Chuck,” as he prefers to be called, earned a recreational round or two.

The namesake brokerage firm he founded and co-chairs reported record quarterly revenue (up 27% year-over-year to $6.1 billion) and profit (up 67% to $2.3 billion), and said total client assets rose 17% to a record $11.6 trillion in the three months through September. On top of beating Wall Street performance expectations, Charles Schwab’s results underscored how interest in this year’s bull market has powered a strong run of financial sector earnings reports this week.

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For four quarters in a row, over a million new brokerage accounts have been opened with Charles Schwab. CEO Rick Wurster noted during an earnings call on Thursday that the influx has led to a flurry of activity: Schwab’s daily average trading volume, from which it generates commissions and fees, reached 7.4 million in the third quarter, a 30% year-over-year increase. The surge can be explained, at least in part, by dramatic market swings due to Washington’s trade policy shifts and the artificial intelligence boom, which incentivized more borrowing among investors to get in on the action by buying stocks. Charles Schwab’s margin balances of $97 billion at the end of the third quarter were up 16% from the end of 2024.

Results from other financial firms this week also showed that clients from scrappy retail traders to high-net-worth jetsetters are hankering for equities and investments. Wealth units at Bank of America (revenue up 19% year over year to $1.3 billion), Goldman Sachs (up 17% to $4.4 billion), Morgan Stanley (up 13% to $8.2 billion) and more notched high marks. Customer assets at Schwab competitor Interactive Brokers rose 40% to $757.5 billion, and daily trades there rose 47% to 3.86 million. Then there’s this year’s seismic rally from retail-focused brokers like Robinhood, whose shares are up over 250% since the beginning of January. And speaking of which:

• Wurster said Schwab is drawing young people usually associated with the newer cohort of digital-native brokers: Gen Z households, he said, account for roughly one-third of new investors this year and millennials another third.

• Wurster said it’s “hard to know whether this level of engagement will persist or grow,” but added the sophistication of investors indicates they’re not fair-weather: “We’ve seen our traders sell the rip and buy the dip, so I think our engagement is likely to be more sustainable than others.”

Charles Schwab shares fell 1% to $93.41 in a down session for the S&P 500. But Raymond James analysts, seeing upside, hiked their price target for the stock to $110 from $104.

Crypto Crazy: Wurster said Charles Schwab is exploring new ways to give investors access to private companies, given the growing ranks of highly valued firms putting off IPOs. It also has a spot crypto offering slated to launch next year, and Schwab clients have already shown a voracious appetite for the sector through crypto exchange-traded funds: Wurster said they hold 20% of all crypto ETF assets in America.

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