Latest quarter
Wells Fargo’s adjusted earnings per share were $1.87 for the third quarter, above the $1.85 consensus. Revenue on the measure used for the consensus comparison was $21.9 billion, below the $22.1 billion consensus.
Separately, Wells Fargo reported quarterly revenue of $33.3 billion, compared with $31.9 billion a year earlier. Diluted earnings per share were $1.95, up from $1.66. The company’s gross margin was 65.8%, compared with 67.2% a year earlier.
Wells Fargo reported that Consumer Banking and Lending revenue grew 5.00%, while Wealth and Investment Management revenue increased 12.0%. The bank also said noninterest income fell −1.00% as markets revenue slowed late in the quarter. Its net interest income grew 5% in the third quarter.
For the preceding second quarter, Wells Fargo’s free cash flow was $6.8 billion, compared with −$11.2 billion a year earlier. The bank also raised its quarterly dividend to $0.50 per share and repurchased $2.5 billion of stock.
| Q3 FY2026 | Q3 FY2025 | Change | |
|---|---|---|---|
| Revenue | $33.3 billion | $31.9 billion | 4.25% |
| Diluted EPS | $1.95 | $1.66 | 17.2% |
| Gross margin | 65.8% | 67.2% | −1.4 percentage points |
| Operating margin | 21.3% | 21.7% | −0.3 percentage points |
| Free cash flow | $6.8 billion | −$11.2 billion | — |
| Against the consensus | Reported | Consensus | Result |
|---|---|---|---|
| Adjusted EPS | $1.87 | $1.85 | Beat by 1.08% |
| Revenue | $21.9 billion | $22.1 billion | Missed by 1.26% |
Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.
What management said on the call
On the second-quarter earnings call, CEO Charlie Scharf said Wells Fargo’s loan and deposit growth reflected both the economic environment and investments across its businesses. He said the bank was deploying capital carefully as it expanded lending. Scharf also cautioned that leverage and risks can develop when large amounts of capital flow into risk assets.
Scharf said efficiency initiatives and lower headcount were helping fund investment in branch bankers, advisers, commercial relationship managers, investment bankers and traders. The bank was also increasing marketing spending, accelerating product development and investing in artificial intelligence and cyber defenses, he said.
In consumer lending, Scharf said credit card account growth required upfront spending on marketing, promotional rates and onboarding. He said newer card customers initially offset some of the profit contribution from earlier groups, but the bank was prioritizing longer-term growth over higher near-term profitability.
CFO Michael Santomassimo said the growth of interest-bearing deposits and the markets business had compressed the net interest margin. He said markets financing carries a lower spread but can bring additional business from those clients. Net interest income nevertheless rose from both the prior quarter and a year earlier, he said.
Asked about deposit trends, Santomassimo said noninterest-bearing deposit growth had been slower than expected, although checking account growth continued. He expected the deposit cost to rise somewhat in the second half as interest-bearing balances grew. Asked about lending, he said new business, rather than materially higher use of existing credit lines, was driving much of the commercial growth.
Scharf said interest rates, markets and credit conditions made it difficult to give a definitive date for the bank’s return target. Assuming favorable conditions continued, he said the bank expected to reach it in a reasonable time frame.
Guidance
At the second-quarter call, CFO Michael Santomassimo said Wells Fargo was maintaining its full-year net interest income outlook. He also said the expense outlook was unchanged, with efficiency initiatives expected to offset higher revenue-related expenses in other areas.
| Metric | For | Guide | Previous guide | Change |
|---|---|---|---|---|
| Operating expenses | FY2026 | $55.7 billion | $55.7 billion | Held |