Brokerage and investment manager Charles Schwab Corp. (SCHW) on Tuesday reported a 10 percent increase in profit for the second quarter on higher revenues and growth in new brokerage accounts.
The results also include a gain related to the resolution of a vendor dispute. Earnings per share were flat with last year, but beat analysts' estimates.
The company's asset management and administration fees for the quarter declined 1 percent to $496 million, reflecting higher money market fund waivers.
Many U.S. brokerages have been waiving fees on money market funds due mainly to a near-zero interest rate environment since December 2008. Charles Schwab waived $146 million in money market fund fees in the latest quarter, compared to $128 million last year.
Net interest revenue rose 2 percent to $458 million, while trading revenue grew 7 percent to $219 million.
Clients' daily average revenue trades rose 10 percent from last year to $435 thousand, while average revenue per revenue trade declined 1 percent.
New brokerage accounts rose 8 percent in the quarter from the year-ago period to 221 thousand.
The company ended the quarter with 8.7 million active brokerage accounts, 822,000 banking accounts, and $1.80 trillion in total client assets. These were up 7, 10 and 9 percent, respectively, over June 2011.
Net new accounts for the quarter totaled about 40,000, down 2 percent year-over-year. As at the end of the second quarter, total accounts reached 6.1 million, up 2 percent year-over-year.
Charles Schwab said its second-quarter net income rose to $261 million from $238 million in the year-ago period. However, earnings per share remained flat with last year at $0.20, on higher number of weighted-average shares outstanding.
The latest quarter's results includes a gain of $44 million after-tax, relating to the earlier disclosed resolution of a vendor dispute.
On average, 22 analysts polled by Thomson Reuters expected the company to report earnings of $0.18 per share for the quarter. Analysts' estimates typically exclude one-time items.
Net revenues for the quarter rose 8 percent to $1.28 billion from $1.19 billion in the year-ago quarter and beat analysts' consensus estimate of $1.23 billion.
Provision for loan losses for the quarter was $4 million, up from $1 million in the same period last year.
Total expenses, excluding interest, for the quarter rose 6 percent to $851 million. Of this, compensation and benefits rose 4 percent from last year, while advertising and market development expenses increased 12 percent.
In Tuesday's regular session, SCHW is trading at $12.78, up $0.11 or 0.87 percent, on a volume of 1.98 million shares.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.