Including the significant items noted on the page, the firm delivered net income of $16.9 billion, EPS of $6.14, and an ROTCE of 23%. Expenses of $27.3 billion were up 15% year-on-year, largely driven by volume and revenue-related expense, as well as growth in front office hiring and labor inflation. This quarter's standardized RWA increase of approximately $103 billion is largely driven by increases in financing across our markets business, as well as growth in traditional lending. As you saw in our CCAR press release in June, the board intends to increase the quarterly dividend to $1.65 per share, effective in the third quarter.
Consumers and small businesses continue to show resilience despite elevated gas prices and inflation, with higher tax refunds and a solid labor market contributing to strong spend growth. In banking and wealth management, average deposits were up 3% year-on-year and 2% quarter-on-quarter, driven by strong net new checking account growth of over 500,000 accounts this quarter. Revenue of $24.9 billion was up 27% year-on-year, driven by strong performance across the businesses. IB fees were up 30% year-on-year, reflecting double-digit growth across all products, with particularly strong performance in equity underwriting.
In markets, fixed income was up 6% year-on-year, with solid performance in credit, currencies in emerging markets, and rates, partially offset by lower revenue and commodities. The equities business delivered an exceptionally strong quarter, with revenue up 86% year-on-year, reflecting the highly dynamic market conditions. Turning to asset and wealth management, AWM reported net income of $2 billion, with pre-tax margin of 38%. Before turning to the outlook, corporate reported net income of $4.2 billion on revenue of $6 billion, which includes the significant items noted in the presentation.
| Metric | Period | Current guidance |
|---|---|---|
| NII ex-Markets | FY2026 | about $96.5 billion (raised) |
| Total NII | FY2026 | approximately $105.5 billion (raised) |
| Markets NII | FY2026 | about $9 billion (raised) |
| Adjusted expense | FY2026 | about $107.5 billion (raised) |
| Card net charge-off rate | FY2026 | approximately 3.2% (lowered) |
| Metric | YoY | Note |
|---|---|---|
| Total revenue (ex significant items) | +15% | Predominantly markets revenue, higher asset management fees in AWM and CCB, higher investment banking revenue, and higher deposit and loan balances, partially offset by lower rates. |
| Expenses | +15% | Volume and revenue-related expense, growth in front office hiring, and labor inflation. |
| CCB revenue | +8% | Higher card NII on higher revolving balances, higher operating lease income in auto, and asset management fees in wealth management. |
| CIB revenue | +27% | Strong performance across the businesses, with IB fees up 30% and equities up 86%. |
| Equities revenue | +86% | Highly dynamic market conditions with strength across products and regions, strong flows, and Prime benefiting from higher client activity and balances. |
| Fixed income revenue | +6% | Solid performance in credit, currencies in emerging markets, and rates, partially offset by lower revenue in commodities. |
| AWM revenue | +19% | Higher management fees on higher average market levels and strong net inflows, plus investment valuation gains, higher loan balances, and higher brokerage activity. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Investment banking and capital markets activity | Healthy pipelines with activity resilient despite Middle East uncertainty | Exceptionally strong quarter with a robust pipeline that management says is itself begetting more activity, though some pull-forward is acknowledged | Improving |
| Consumer health | Resilient consumer, credit tied to a strong labor market | Consumers and small businesses resilient with strong spend, delinquencies below expectations, and little support for the K-shape narrative | Stable |
| Expense growth and operating leverage | Meaningful expense growth reflecting investment and revenue-related costs | Guidance raised $2.5B, of which $1.5B already booked against $6.5B of first-half markets/banking outperformance | Increasing |
| AI investment | Ongoing investment with roughly 1,000 use cases | Roughly 1,000 use cases with about 50 important ones; benefits expected to accrue mainly to customers, with token expense a small but accelerating item | Increasing |
| Capital deployment and buybacks | Prefer to deploy excess capital organically rather than buy back stock at high prices | Reiterated preference to deploy roughly $40 billion of excess organically at ~17% returns, buy back less as price rises, and stay open to inorganic opportunities | Stable |