Schwab's Q4 Earnings and Revenue Beat, Expenses Fall, Stock Gains

Earnings Performance - Charles Schwab's Q4 2024 adjusted earnings of $1.01 per share beat the Zacks Consensus Estimate of 90 cents, marking a 49% year-over-year increase [1] - Net income (GAAP basis) for Q4 2024 was $1.84 billion or 94 cents per share, up from $1.05 billion or 51 cents per share in the year-ago quarter [3] - For full-year 2024, adjusted earnings were $3.25 per share, surpassing the consensus estimate of $3.16 and rising 4% year-over-year [4] - Full-year net income (GAAP basis) was $5.94 billion or $2.99 per share, up from $5.07 billion or $2.54 per share in 2023 [4] Revenue and Expenses - Q4 2024 net revenues were $5.33 billion, a 20% year-over-year increase, beating the Zacks Consensus Estimate of $5.18 billion [5] - Full-year 2024 net revenues grew 4% to $19.61 billion, surpassing the consensus estimate of $19.46 billion [5] - Total non-interest expenses (GAAP basis) decreased 7% to $3.02 billion in Q4 2024 [6] - Adjusted total expenses were $2.85 billion in Q4 2024, relatively stable year-over-year [6] Business Metrics - Total client assets as of Dec 31, 2024, were $10.1 trillion, up 19% year-over-year [8] - Net new assets in Q4 2024 were $108.4 billion [8] - Schwab added 1.11 million new brokerage accounts in Q4 2024, bringing total active brokerage accounts to 36.5 million [8] - The company had 2 million banking accounts and 5.4 million corporate retirement plan participants as of Dec 31, 2024 [8] Profitability and Assets - Pre-tax profit margin increased to 43.3% in Q4 2024 from 26.8% in the prior-year quarter [6] - Annualized return on equity was 18% as of Dec 31, 2024, up from 12% in the prior-year quarter [7] - Average interest-earning assets decreased 3% to $426.4 billion in Q4 2024 [6] Industry Context - Raymond James is scheduled to announce quarterly earnings on Jan 29, with the Zacks Consensus Estimate revised 1.5% upward to $2.75, suggesting a 14.9% rise from the prior-year quarter [11] - LPL Financial is set to announce Q4 and full-year 2024 results on Jan 30, with the Zacks Consensus Estimate for quarterly earnings at $3.88, implying 10.5% growth from the prior-year quarter [12]