Wells Fargo & Co Earnings - Q3 2025 Analysis & Highlights
Key Takeaways
Wells Fargo's Q3 2025 earnings call highlighted strong financial results driven by investments, the lifting of the asset cap, and a focus on growth opportunities, expense management, and capital return. Key themes included revenue diversification, improved efficiency, and a new ROTCE target of 17% to 18%.
Key Financial Results
Net income increased 9% from a year ago.
Diluted earnings per share was $1.66.
Revenue increased 5% from a year ago.
Net interest income saw growth.
Investment banking fees increased 25% from a year ago.
Loan growth accelerated.
Return on tangible common equity (ROTCE) was 15.2%.
Business Segment Results
Consumer, Small and Business Banking revenue increased 6% from a year ago.
Home Lending revenue increased 3% from a year ago.
Credit Card revenue grew 13% from a year ago.
Auto revenue declined 6% from a year ago but increased 6% from the second quarter.
Commercial Banking revenue was down 9% from a year ago.
Corporate and Investment Banking revenue grew 1% from a year ago.
Wealth and Investment Management revenue increased 8% from a year ago.
Capital Allocation
Common stock dividend was raised.
Share repurchases doubled from the second quarter, with $6.1 billion repurchased in Q3.
The company is managing to a CET1 ratio of approximately 10% to 10.5%.
The company ended the third quarter with over $30 billion of capital above regulatory minimums.
Industry Trends and Dynamics
The US is considered the most attractive market in financial services.
Scale matters in businesses like Consumer Banking, Wealth Management, Corporate Banking, and Commercial Banking.
There is a focus on being a top US bank.
Competitive Landscape
Wells Fargo aims to be a top US consumer and small business bank and wealth manager.
The goal is to be a top 5 US investment bank.
The company wants all businesses to generate returns and growth equal to its best competitors.
Wells Fargo has gained over 120 basis points of share in the US in Investment Banking since 2022.
Macroeconomic Environment
The company benefits from the strength of the US economy and markets.
The new ROTCE target is dependent on factors including interest rates and the broader macroeconomic environment.
Growth Opportunities and Strategies
Focus on growth in US consumer and US-based companies.
Re-accelerating checking account growth through enhanced marketing and digital account openings.
Investing in the branch network.
Growing the credit card portfolio.
Growing deposits through the Global Payments and Liquidity business.
Targeting 19 high-density markets for growth.
Investing to grow the corporate and investment bank.
Launched Wells Fargo Premier to better serve affluent clients.
Financial Guidance and Outlook
Targeting a 17% to 18% ROTCE over the medium term.
Managing to a 10% to 10.5% CET1 ratio.
Full-year 2025 net interest income is expected to be roughly in line with full-year 2024.
Fourth quarter net interest income is expected to grow from the third quarter to approximately $12.4 billion to $12.5 billion.
Full-year 2025 noninterest expense is expected to be approximately $54.6 billion, with the fourth quarter at approximately $13.5 million.
