Huntington Bancshares Incorporated (HBAN) Earnings & Analysis

Latest quarter

Huntington reported adjusted earnings per share of $0.38 for the third quarter of FY2026, matching the consensus; revenue as the consensus counts it missed the estimate. Both reported and consensus revenue rounded to $2.8 billion.

Huntington reported total revenue of $4.1 billion, up from $3.2 billion a year earlier, while revenue net of interest expense was $2.81 billion. Diluted earnings per share fell to $0.33 from $0.41.

CFO Zachary Wasserman said net interest income—the difference between interest earned and interest paid—rose 37% from a year earlier to approximately $2.1 billion. He said value-added fee revenue increased more than 15% year over year, including the Veritex and Cadence partnerships.

Huntington reported an operating margin of 21.8%, compared with 23.7% a year earlier, and free cash flow of $683.0 million, compared with $446.0 million. Wasserman said net charge-offs were 31 basis points, up 6 basis points from the prior quarter, primarily reflecting one commercial credit charge-off.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

CEO Stephen Steinour said commercial lending growth was driven by Huntington’s national commercial strategy, while the bank had scaled back in some asset classes where pricing no longer met its risk-adjusted return requirements. CFO Zachary Wasserman said commercial and industrial lending led quarterly growth, partly offset by lower commercial real estate, auto and residential mortgage balances.

Asked about loan growth and competition, President Brantley Standridge said narrower margins in auto and residential lending had prompted a pullback: “our pullback really reflects more of capital allocation discipline versus a change in the ultimate business.” He said commercial pipelines supported Huntington’s expectation of loan growth in the fourth quarter, while the outlook assumed competitive pressure in those lending businesses would continue into 2027.

Steinour told analysts that commercial real estate exposure was falling faster than Huntington had projected. He said refinancing activity in July and August had moved more loans than expected to Fannie Mae and Freddie Mac, with some going to debt funds; he also said construction commitments had declined significantly during the quarter.

Wasserman said average deposits rose approximately $500 million, or 0.2%, from the prior quarter, and the net interest margin rose 4 basis points to 3.25%. Standridge said deposit pricing remained competitive, with pressure on certificates of deposit in Texas and the Southeast; Huntington was adjusting prices by market and working to optimize the Cadence deposit portfolio.

On integration and investment, Wasserman said Huntington completed Cadence expense-synergy actions during the quarter and expected their full run-rate benefit to begin in the fourth quarter. Standridge said customer and banker retention were within Huntington’s expectations and that the company was adding resources in the new markets. Wasserman said expense reengineering would create capacity to invest in growth.

Asked about next year’s credit outlook, Director of Investor Relations Eric Wasserstrom said Huntington’s expectations did not contemplate a reserve release in 2027; he said the company expected to build reserves as the portfolio grew.

Guidance

Wasserman said Huntington was tracking to 2027 earnings per share guidance of $1.75 to $1.83; in the second-quarter call, he had given an earnings objective of $1.90 to $1.93. Steinour said Huntington expected return on tangible common equity to rise into the 17% to 18% range in 2027, compared with the 18% to 19% target he cited on the prior call.

For the fourth quarter, Wasserman said Huntington expected net interest margin to be approximately flat; on the prior call, he had expected it to reach the mid- to high-3.20% range.