U.S. Bancorp USB posted upbeat earnings for the second quarter but fell short of revenue expectations.The company reported second-quarter adjusted earnings per share of $1.11, beating the analyst consensus estimate of $1.07.Quarterly sales of $7.004 billion (+2% year over year) missed the Street view of $7.052 billion. On a GAAP basis, U.S. Bancorp registered revenues of $6.975 billion, missing the analyst consensus estimate of $7.052 billion."Year-over-year top-line revenue growth, coupled with our continu ...

Core Insights - U.S. Bancorp's second-quarter 2025 earnings per share of $1.11 exceeded the Zacks Consensus Estimate of $1.07, reflecting a 13.3% increase from the prior-year quarter, driven by lower expenses and higher non-interest income [1][8] - Total revenues for the quarter were $7 billion, a 2% year-over-year increase, but fell short of the Zacks Consensus Estimate by 0.8% [2][8] - Concerns arose from a decline in both deposits and loans, leading to a 4% drop in shares during pre-market trading [1][8] Financial Performance - Net income attributable to U.S. Bancorp was $1.82 billion, marking a 13.2% increase from the previous year [2] - Tax-equivalent net interest income (NII) reached $4.08 billion, showing a slight increase year-over-year, primarily due to fixed asset repricing and a favorable loan mix [3] - Non-interest income rose by 3.9% year-over-year to $2.92 billion, with growth in most components except for corporate payment products and mortgage banking revenues [4] Expense Management - Non-interest expenses decreased marginally to $4.18 billion, attributed to reductions in most components, while the efficiency ratio improved to 59.2% from 61% in the prior year, indicating enhanced profitability [5] - Adjusted non-interest expenses also saw a slight decline compared to the previous year [5] Loan and Deposit Trends - Average total loans decreased by 0.1% to $378.5 billion, while average total deposits fell by 0.7% to $502.9 billion [6] Credit Quality - The total allowance for credit losses was $7.86 billion, down approximately 1% year-over-year, with non-performing assets decreasing by 9.3% to $1.68 billion [7] - Net charge-offs increased by 3% to $554 million, while the provision for credit losses was $501 million, down 11.8% from the prior year [7] Capital Ratios - The Tier 1 capital ratio improved to 12.3% from 11.9% year-over-year, and the Common Equity Tier 1 capital ratio rose to 10.7% from 10.2% [9] - The tangible common equity to tangible assets ratio increased to 6.1% from 5.4% in the previous year [9] Future Outlook - U.S. Bancorp's solid business model and diverse revenue streams are expected to support its financial performance in the future, with an improving NII being a positive indicator [10]

The bank reported strong Q2 2025 earnings with a 13.2% YoY rise in net income and 18% return on tangible common equity, but investors reacted cautiously due to soft revenue and net interest income, and conservative Q3 guidance.Through its Elavon subsidiary and new embedded payment suite, U.S. Bank is evolving from a traditional processor to a front-end enabler of commerce.U.S. Bancorp is doubling down on embedded payments, blockchain and AI-driven infrastructure, aiming to become a platform-centric, infrast ...

Financial Data and Key Metrics Changes - The company reported earnings per share of $1.11 and net income of $1.8 billion, reflecting a year-over-year EPS growth of approximately 13% [5][14] - Total fee revenue grew by 4.6% year-over-year, driven by broad-based strength across various businesses [5][20] - The return on tangible common equity was 18%, and the return on average assets improved to 1.08% [6][15] - The efficiency ratio improved to the high 50s, indicating better expense management [6][15] Business Line Data and Key Metrics Changes - Fee income now represents approximately 42% of total net revenue, with significant growth in payment services [7][10] - Merchant payment services revenue grew 4.4% year-over-year, supported by a tech-led strategy [10] - The capital markets business is focused on introducing new product capabilities, contributing to growth in commercial and industrial (C&I) loans [9][10] Market Data and Key Metrics Changes - The company divested approximately $6 billion in mortgage and auto loans to strategically reposition its balance sheet [13] - C&I and credit card portfolios represented 47% of the balance sheet, up from 43% at the end of 2023, with average loans growing 6.6% year-over-year [12][13] - Average consumer deposit balances increased by $2.4 billion or 1.1% linked quarter, while the percentage of non-interest-bearing deposits remained stable at approximately 16% [17] Company Strategy and Development Direction - The company is focused on three key priorities: expense discipline, organic growth, and transformation of the payments business [26] - There is an intentional evolution of the business mix to be more fee-intensive and diversified, with a shift towards multi-service clients [26][27] - The company aims to deliver sustainable EPS growth while maintaining a focus on operational efficiency and productivity [26][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to navigate the current higher interest rate environment and position the balance sheet for near-term margin expansion [6][14] - The company expects net interest income for the third quarter to be in the range of $4.1 billion to $4.2 billion, with total fee revenue expected to be approximately $3 billion [23] - Management remains optimistic about achieving medium-term profitability and efficiency targets, despite some headwinds in net interest income [15][25] Other Important Information - The company reported stable asset quality trends and credit metrics, with a modest reserve release of $53 million this quarter [15][21] - The CET1 capital ratio was 10.7%, well above regulatory minimums, reflecting strong capital levels [21][22] - The company is strategically evolving both sides of the balance sheet to support a higher net interest income trajectory [75] Q&A Session Summary Question: NII dynamics and margin outlook - Management indicated that part of the linked quarter decline in net interest margin was transitory and expects sequential net interest income growth in the upcoming quarters [31][32] Question: Expense management and operating leverage - Management reassured that cost-cutting measures do not hinder necessary investments, emphasizing self-funding initiatives and operational efficiencies [36][39] Question: C&I loan growth drivers - Management highlighted strong growth in C&I loans, driven by increased utilization rates and strength in various sectors, including healthcare [60][61] Question: RWA increase and deposit competition - Management explained that the increase in risk-weighted assets was due to credit risk transfers and commercial loan growth, while deposit competition remains a consistent challenge [70][72] Question: Future loan growth outlook - Management expressed optimism about loan growth, particularly in C&I and credit card segments, indicating better growth opportunities than at the beginning of the year [85][86]

Financial Data and Key Metrics Changes - The company reported earnings per share (EPS) of $1.11 and net income of $1.8 billion, reflecting a year-over-year EPS growth of approximately 13% [4][14] - Total fee revenue grew by 4.6% year-over-year, driven by broad-based strength across various businesses [4][21] - The return on tangible common equity was 18%, and the return on average assets improved to 1.08% [5][15] - The efficiency ratio improved to the high 50s, indicating better expense management [5][15] Business Line Data and Key Metrics Changes - Fee income now represents approximately 42% of total net revenue, with significant growth in payment services [6][10] - The capital markets business is focusing on new product capabilities, contributing to growth in commercial and industrial (C&I) loans [8][9] - Merchant payment services revenue grew 4.4% year-over-year, supported by a tech-led strategy [10] Market Data and Key Metrics Changes - The company divested approximately $6 billion in mortgage and auto loans to strategically reposition its balance sheet [13] - Average loans totaled $379 billion, with a decrease of 0.1% linked quarter, impacted by the sale of residential mortgages and auto loans [17][18] - The investment securities portfolio increased to $174 billion, reflecting a strategic shift in asset allocation [19] Company Strategy and Development Direction - The company is focused on three key priorities: expense discipline, organic growth, and transformation of the payments business [27] - There is an intentional evolution towards a more fee-intensive business model, with a focus on multi-service clients [26][27] - The company aims to achieve a net interest margin (NIM) of 3% in the medium term, supported by strategic actions and loan growth [33][80] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to navigate the current higher interest rate environment and expects sequential net interest income growth in the upcoming quarters [31][32] - The company anticipates continued growth in C&I and credit card portfolios, with strong pipelines [32][88] - Management acknowledged the competitive deposit environment but remains optimistic about the trajectory of net interest income [74][78] Other Important Information - The company reported a modest reserve release of $53 million, reflecting favorable loan portfolio sales [15][22] - The CET1 capital ratio was 10.7%, indicating strong capital levels above regulatory minimums [22][23] - The company is preparing for potential regulatory changes regarding stablecoins, although immediate revenue impact is not anticipated [116] Q&A Session Summary Question: NII dynamics and margin outlook - Management indicated that part of the NIM decline was transitory and expects sequential growth in NII in the upcoming quarters [31][32] Question: Expense management and operating leverage - Management reassured that expense management does not hinder necessary investments and highlighted ongoing investments in technology and productivity [36][39] Question: C&I loan growth drivers - Management noted strong growth in C&I loans, driven by various sectors including healthcare and small businesses [62][63] Question: RWA increase and deposit competition - Management explained the increase in RWA was due to credit risk transfers and commercial loan growth, while deposit competition remains a consistent challenge [72][74] Question: Future loan growth outlook - Management expressed optimism about loan growth, particularly in C&I and credit card segments, indicating better growth opportunities than earlier in the year [88] Question: Fee revenue growth expectations - Management remains confident in mid-single-digit growth for overall fees and payments businesses [95]

Core Viewpoint - U.S. Bancorp reported quarterly earnings of $1.11 per share, exceeding the Zacks Consensus Estimate of $1.07 per share, and showing an increase from $0.98 per share a year ago, indicating a positive earnings surprise of +3.74% [1][2] Financial Performance - The company posted revenues of $7 billion for the quarter ended June 2025, which was 0.84% below the Zacks Consensus Estimate, compared to $6.84 billion in the same quarter last year [2] - Over the last four quarters, U.S. Bancorp has surpassed consensus EPS estimates four times but has only topped revenue estimates once [2] Stock Performance - U.S. Bancorp shares have declined approximately 4.5% year-to-date, contrasting with the S&P 500's gain of 6.5% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it is expected to perform in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $1.08 on revenues of $7.17 billion, and for the current fiscal year, it is $4.30 on revenues of $28.41 billion [7] - The trend of earnings estimate revisions is mixed ahead of the earnings release, which may influence future stock performance [6] Industry Context - The Banks - Major Regional industry, to which U.S. Bancorp belongs, is currently ranked in the top 6% of over 250 Zacks industries, indicating a favorable outlook compared to lower-ranked industries [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact investor sentiment [5]

Financial Performance Highlights - U S Bancorp achieved earnings per share of $1.11, a 13% increase compared to 2Q24 (adjusted)[12] - The company's Return on Tangible Common Equity was 18.0%[12] - Positive operating leverage was 250 bps year-over-year (adjusted)[12] - Total fee revenue grew by 4.6% year-over-year[12] - The efficiency ratio improved to 59.2%[12] Balance Sheet and Credit Quality - Total assets reached $686.4 billion[14,36] - Earning assets averaged $613.3 billion[14,36] - Total loans amounted to $380.2 billion[14,36] - Total deposits were $518.7 billion[14,36] - The Nonperforming Assets (NPA) ratio was 0.44%[38] - The net charge-off ratio was 0.59%[38] Revenue Mix and Strategy - Fee income represented approximately 42% of U S Bancorp's total net revenue[9,14] - The company is shifting towards a higher quality revenue mix by expanding beyond traditional banking products and services[27] - Multi-service clients contribute approximately 3x more revenue than single-service clients[30] Expense Management and Efficiency - The company achieved seven consecutive quarters of stable expenses (adjusted)[8,16] - Positive operating leverage was maintained for four straight quarters[7,16] - Noninterest expense was $4.181 billion[34]

智通财经7月17日电，美国合众银行第二季度每股收益1.11美元，高于预期的1.06美元。 ...

[Consolidated Financial Statements](index=2&type=section&id=Consolidated%20Financial%20Statements) [Quarterly Consolidated Statement of Income](index=2&type=section&id=QUARTERLY%20CONSOLIDATED%20STATEMENT%20OF%20INCOME) U.S. Bancorp's Q2 2025 net income rose to **$1.815 billion**, driven by increased noninterest income and improved efficiency, with diluted EPS reaching **$1.11** Key Income Statement Data (Q2 2025 vs. Prior Periods) | (Millions of Dollars, Except Per Share Data) | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Interest Income | $4,051 | $4,092 | $4,023 | | Total Noninterest Income | $2,924 | $2,836 | $2,815 | | Provision for Credit Losses | $501 | $537 | $568 | | Net Income Attributable to U.S. Bancorp | $1,815 | $1,709 | $1,603 | | Diluted Earnings Per Share | $1.11 | $1.03 | $0.97 | | Dividends Declared Per Common Share | $0.50 | $0.50 | $0.49 | Key Financial Ratios (%) | Ratio | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Interest Margin (taxable-equivalent) | 2.66% | 2.72% | 2.67% | | Return on Average Assets | 1.08% | 1.04% | 0.97% | | Return on Average Common Equity | 12.9% | 12.3% | 12.4% | | Efficiency Ratio | 59.2% | 60.8% | 61.0% | [Consolidated Ending Balance Sheet](index=4&type=section&id=CONSOLIDATED%20ENDING%20BALANCE%20SHEET) Total assets reached **$686.4 billion** as of June 30, 2025, with deposits growing to **$518.7 billion** and shareholders' equity increasing to **$61.4 billion** Key Balance Sheet Data (As of June 30, 2025) | (Billions of Dollars) | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Total Assets | $686.4 | $676.5 | $680.1 | | Net Loans | $372.7 | $374.2 | $368.6 | | Total Deposits | $518.7 | $512.5 | $523.8 | | Total U.S. Bancorp Shareholders' Equity | $61.4 | $60.1 | $56.4 | [Consolidated Average Balance Sheet and Yields/Rates](index=6&type=section&id=CONSOLIDATED%20AVERAGE%20BALANCE%20SHEET%20AND%20YIELDS%2FRATES) Q2 2025 saw a **Net Interest Margin (NIM)** compression to **2.66%** due to higher funding costs, while average earning assets remained stable at **$613.3 billion** - The Net Interest Margin (NIM) on a taxable-equivalent basis compressed to **2.66%** in Q2 2025, down **6 basis points** from Q1 2025 and **1 basis point** from Q2 2024[7](index=7&type=chunk)[11](index=11&type=chunk) Year-over-Year Average Balance and Yield Comparison (Q2 2025 vs. Q2 2024) | (Millions of Dollars) | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Average Total Earning Assets | $613,342 | $608,892 | 0.7% | | Average Total Loans | $378,529 | $374,685 | 1.0% | | Average Total Deposits | $502,890 | $513,909 | (2.1)% | | Yield on Total Earning Assets | 4.99% | 5.29% | - | | Rate on Total Interest-Bearing Liabilities | 2.80% | 3.18% | - | Quarter-over-Quarter Average Balance and Yield Comparison (Q2 2025 vs. Q1 2025) | (Millions of Dollars) | Q2 2025 | Q1 2025 | % Change | | :--- | :--- | :--- | :--- | | Average Total Earning Assets | $613,342 | $610,230 | 0.5% | | Average Total Loans | $378,529 | $379,028 | (0.1)% | | Average Total Deposits | $502,890 | $506,534 | (0.7)% | | Yield on Total Earning Assets | 4.99% | 4.99% | - | | Rate on Total Interest-Bearing Liabilities | 2.80% | 2.75% | - | [Loan Portfolio](index=16&type=section&id=LOAN%20PORTFOLIO) The total loan portfolio reached **$380.2 billion** in Q2 2025, with commercial loans as the largest segment at **38.8%**, while residential mortgages declined Loan Portfolio Composition (as of June 30, 2025) | Loan Category | Amount (Millions of Dollars) | Percent of Total | | :--- | :--- | :--- | | Total Commercial | $147,416 | 38.8% | | Total Commercial Real Estate | $48,181 | 12.7% | | Total Residential Mortgages | $114,475 | 30.1% | | Credit Card | $30,023 | 7.9% | | Total Other Retail | $40,148 | 10.5% | | **Total Loans** | **$380,243** | **100.0%** | - Compared to the prior quarter, commercial loans increased by **$3.3 billion**, while residential mortgages and commercial real estate loans decreased by **$4.4 billion** and **$0.15 billion**, respectively[16](index=16&type=chunk) [Supplemental Business Segment Schedules](index=17&type=section&id=Supplemental%20Business%20Segment%20Schedules) [Wealth, Corporate, Commercial and Institutional Banking](index=18&type=section&id=WEALTH%2C%20CORPORATE%2C%20COMMERCIAL%20AND%20INSTITUTIONAL%20BANKING) Net income for this segment was **$1.10 billion** in Q2 2025, impacted by higher credit loss provisions, despite total net revenue reaching **$3.0 billion** and AUM growing to **$536.4 billion** Segment Performance Highlights | (Millions of Dollars) | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Income | $1,098 | $1,200 | $1,183 | | Total Net Revenue | $3,000 | $2,947 | $3,058 | | Provision for Credit Losses | $183 | $10 | $100 | | Total Net Charge-offs | $106 | $61 | $107 | - Assets Under Management (AUM) increased to **$536.4 billion**, up from **$524.3 billion** in the prior quarter, with growth seen in fixed income and money market categories[20](index=20&type=chunk) [Consumer and Business Banking](index=23&type=section&id=CONSUMER%20AND%20BUSINESS%20BANKING) Net income for Consumer and Business Banking rose to **$459 million** in Q2 2025, driven by higher net interest income and lower credit loss provisions, while branch count decreased to **2,081** Segment Performance Highlights | (Millions of Dollars) | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Income | $459 | $408 | $493 | | Net Interest Income | $1,843 | $1,768 | $1,912 | | Mortgage Banking Revenue | $162 | $173 | $160 | | Provision for Credit Losses | $39 | $62 | $30 | - Mortgage production volume increased significantly to **$9.6 billion** from **$6.6 billion** in the prior quarter[24](index=24&type=chunk) - The number of branches continued to decline, reaching **2,081** at the end of Q2 2025, down from **2,117** in Q1 2025 and **2,207** a year ago[23](index=23&type=chunk) [Payment Services](index=29&type=section&id=PAYMENT%20SERVICES) Payment Services reported **$325 million** net income in Q2 2025, with total net revenue growing to **$1.85 billion** driven by increased card and merchant processing volumes, despite higher credit loss provisions Segment Performance Highlights | (Millions of Dollars) | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Income | $325 | $337 | $289 | | Total Net Revenue | $1,846 | $1,777 | $1,766 | | Total Noninterest Income | $1,116 | $1,035 | $1,093 | | Provision for Credit Losses | $384 | $317 | $388 | - Credit card net charge-off ratio was **4.30%**, down slightly from **4.48%** in the prior quarter but comparable to **4.47%** a year ago[28](index=28&type=chunk) - Merchant acquiring volume increased to **$155.9 billion** from **$143.5 billion** in the prior quarter, reflecting strong transaction growth[29](index=29&type=chunk) [Treasury and Corporate Support](index=34&type=section&id=TREASURY%20AND%20CORPORATE%20SUPPORT) Treasury and Corporate Support reported a reduced net loss of **$67 million** in Q2 2025, significantly improving from prior quarters due to a **$105 million** reserve release and lower noninterest expenses Segment Performance Highlights | (Millions of Dollars) | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Income (Loss) | ($67) | ($236) | ($362) | | Net Interest Income (Loss) | ($294) | ($168) | ($461) | | Provision for Credit Losses | ($105) | $148 | $50 | - The segment recorded a reserve release (negative provision) of **$105 million**, contrasting with a provision expense of **$148 million** in the prior quarter[30](index=30&type=chunk)

Group 1 - U.S. Bancorp is set to release its second-quarter earnings results on July 17, with expected earnings of $1.07 per share, up from 97 cents per share a year ago [1] - The company is projected to report quarterly revenue of $7.07 billion, an increase from $6.84 billion in the previous year [1] - U.S. Bancorp raised its quarterly cash dividend from 50 cents to 52 cents per share on July 1 [2] Group 2 - Truist Securities analyst John McDonald maintained a Hold rating and raised the price target from $48 to $50 [4] - Raymond James analyst Michael Rose upgraded the stock from Outperform to Strong Buy and increased the price target from $51 to $57 [4] - Morgan Stanley analyst Betsy Graseck maintained an Overweight rating and raised the price target from $50 to $51 [4] - Citigroup analyst Keith Horowitz maintained a Buy rating and increased the price target from $55 to $59 [4] - Goldman Sachs analyst Richard Ramsden maintained a Neutral rating and raised the price target from $41 to $46 [4]