Charles Schwab rose after the company reported second-quarter earnings that topped estimates as client assets hit a new record and trading revenue increased.
Schwab posted adjusted earnings per share of $1.14 while total client assets climbed 14% to $10.76 trillion year over year, according to a statement. Revenue from client trades also jumped 23% to $952 million.
“Retail investors and RIAs continued to turn to Schwab as a trusted partner, opening over 1 million new brokerage accounts,” said CEO Rick Wurster.
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Daily average revenue trades just narrowly topped analyst forecasts at 7.57 million in a quarter characterized by market turmoil from President Donald Trump’s tariff and policy changes. The firm attracted $73.6 billion in total net new assets, which was below analyst expectations.
Shares were up 3.4% at 9:58 a.m. in New York after rising as much as 4.73%.
The firm said in May that it saw two of its busiest trading days ever during the quarter, triggering calls to Schwab clients when they neared a margin call. The thinking behind the calls, Wurster explained then, was that customers could top off their accounts rather than automatically being pulled out of a position, which he said that clients appreciated at the time.
Schwab said on Friday that margin balances ended the quarter at $83.4 billion — largely flat quarter over quarter — “as investors selectively increased leverage while equity markets rebounded following the disruption in early April.”
Digital asets
Wurster, who stepped into the CEO role at the beginning of this year, said on an earnings call with analysts that the firm is continuing to build out its digital assets offering, which will include spot trading in bitcoin and ethereum. He expects it to be a “meaningful” growth driver, he added. Schwab is also exploring “multiple” ways to deliver a stablecoin and has had conversations with large banks around a consortium effort as well as also looking into its own avenues, he said.
“Stablecoins are likely to play a role in transacting on blockchains and that’s something we do want to be able to offer,” he said. “We will have a stablecoin at some point.”
The firm also said new brokerage account openings rose 11% year over year to 1.1 million.
Schwab said that client transactional sweep cash ended June at $412.1 billion, “enabling us to further reduce higher cost bank funding by $10.4 billion to $27.7 billion at quarter-end,” chief financial officer Mike Verdeschi said in the statement.
