This quarter, the firm reported net income of $16.5 billion and EPS of $5.94, with an ROTCE of 23%. Expenses of $26.9 billion were up 14% year-on-year, largely driven by higher compensation, including higher revenue-related compensation and growth in front office employees, as well as higher brokerage expense and distribution fees. The increase also reflects the absence of an FDIC special accrual release in the prior year. The result is that under the proposed rules, our CT1 capital would increase around 4%, while the Fed's estimate for large banks is about a 5% reduction.
Our longstanding position has been that the agencies should calculate each component of the capital requirements correctly, without regard to what that may mean for any specific firm or for the broader industry. This could have been addressed by better adjusting for growth in the system, but it wasn't enough. Revenue of $19.6 billion was up 7% year-on-year, predominantly driven by higher card NII, largely on higher revolving balances and higher operating lease income in auto. Notwithstanding the recent volatility in market and gas prices, based on our data, consumers and small businesses remain resilient, with consumer spend growth continuing above last year's pace.
Average deposits were up 2% year-on-year and quarter-on-quarter, driven by account growth and moderating yield-seeking flows. Revenue of $23.4 billion was up 19% year-on-year, driven by higher revenues across the businesses. In Markets, FICC income was up 21% year-on-year with strong performance across the businesses, partially offset by lower revenue and rates. Turning to Asset and Wealth Management, AWM reported net income of $1.8 billion, with pre-tax margin of 35%.
| Metric | Period | Current guidance |
|---|---|---|
| NII ex-Markets | FY2026 | about $95 billion (unchanged) |
| Total NII | FY2026 | approximately $103 billion (lowered on lower markets NII from rates) |
| Markets NII | FY2026 | about $8 billion (lowered predominantly due to rates) |
| Adjusted expense | FY2026 | about $105 billion (unchanged) |
| Card net charge-off rate | FY2026 | approximately 3.4% (unchanged) |
| Metric | YoY | Note |
|---|---|---|
| Total revenue | +10% | Higher markets revenue, higher asset management and investment banking fees, and higher NII from balance sheet growth, predominantly offset by the impact of lower rates. |
| Expenses | +14% | Higher compensation including revenue-related compensation and front office growth, higher brokerage expense and distribution fees, and the absence of a prior-year FDIC special accrual release. |
| CCB revenue | +7% | Higher card NII on higher revolving balances and higher operating lease income in auto. |
| CIB revenue | +19% | Higher revenues across the businesses, with IB fees up 28%, FICC up 21%, and equities up 17%. |
| FICC revenue | +21% | Strong performance across the businesses, partially offset by lower revenue in rates. |
| Equities revenue | +17% | Increased client activity. |
| AWM revenue | +11% | Growth in management fees on strong net inflows and higher average market levels, as well as higher brokerage activity. |
| Home lending originations | +46% | Predominantly driven by refi performance. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Private credit and NBFI risk | Framed $160 billion narrower NBFI exposure with strong loss history | Private credit sized at about $50-60 billion within NBFI; Dimon argued a credit cycle will be worse than expected but not systemic given size relative to other markets | Stable |
| Bank capital regulation | Awaiting Basel III Endgame and G-SIB reproposals | Reproposals released; firm supports coherence but has significant concerns on G-SIB, seeing about $20 billion of added capital and a 5.2% 2028 surcharge | Worsening |
| Consumer resilience | Resilient consumer with credit consistent with historical norms | Still resilient with spend above last year and healthy credit metrics, though gas prices and the labor market are watch items | Stable |
| Markets/trading strength | Equities up 40% and robust FICC in the prior quarter | Continued strength with FICC up 21% and equities up 17%, supported by more capital deployment at returns below the 17% firm average | Stable |
| AI opportunity and cyber risk | Investing across roughly 1,000 use cases | AI seen as creating adjacencies and efficiency that mostly benefit customers, while heightening cyber risk that Dimon calls the firm's largest risk | Increasing |