Schwab Reports Fourth Quarter and Full Year Results

Business Wire

Tue, Jan 21, 2025, 5:30 AM 9 min read

WESTLAKE, Texas, January 21, 2025--(BUSINESS WIRE)--The Charles Schwab Corporation reported net income for the fourth quarter totaling $1.8 billion, or $.94 earnings per share. Excluding $177 million of pre-tax transaction-related and restructuring costs, adjusted ⁽¹⁾ net income and earnings per share equaled $2.0 billion and $1.01, respectively.

Client Driven Growth	$367B 2024 Core Net New Assets	"In the fourth quarter of 2024, we added $115 billion in core net new assets, bringing asset gathering for the year to $367 billion – a 4.3% annualized growth rate. This 20% annual increase in net new assets reflects our ongoing progress following the Ameritrade integration." CEO Rick Wurster

Revenue Growth	20% 4Q24 Revenue Growth vs. 4Q23	"Strong client engagement, increased margin utilization, encouraging client cash trends, and record net inflows into our Managed Investing Solutions helped lift 4Q24 revenue to $5.3 billion, – an increase of 20% year-over-year." CEO Rick Wurster

Through- the-Cycle Profitability	46.6% 4Q24 Adjusted Pre-Tax Profit Margin ⁽¹⁾	"The combination of 20% revenue growth and disciplined expense management resulted in a 4Q24 pre-tax profit margin of 43.3% – 46.6% adjusted ⁽¹⁾ – as well as quarterly GAAP and adjusted ⁽¹⁾ earnings per share growth of 84% and 49%, respectively." CFO Mike Verdeschi

Balance Sheet Management	$14.9B 4Q24 Reduction in Bank Supplemental Funding ⁽²⁾	"Client transactional sweep cash grew by $35 billion versus 3Q24, including a $25 billion increase in December due to typical year-end seasonality. This build helped us further reduce Bank Supplemental Funding by $14.9 billion to $49.9 billion – down ~50% from peak levels." CFO Mike Verdeschi

4Q24 Client and Business Highlights

Net asset gathering helped total client assets increase 19% year-over-year to $10.10 trillion
Core net new assets equaled $114.8 billion, bringing full year total to $366.9 billion – up 20% versus 2023
New brokerage account openings increased 23% year-over-year to 1.1 million for the quarter, pushing total active accounts to 36.5 million
Managed Investing Solutions net inflows of $15 billion brought the full-year total to a record $55 billion – with converted Retail Ameritrade clients accounting for approximately 35% of net inflows
Margin balances grew sequentially by 15% to $83.8 billion, up 34% from year-end 2023
Trading activity increased 11% relative to the prior quarter as client engagement surged following the election
Retail client satisfaction scores achieved record levels, while Advisor Services promoter scores remained above pre-conversion levels
Schwab was awarded America’s Best Customer Service 2025 by Newsweek ⁽³⁾
Schwab Mobile recognized as the #1 mobile investing app by Corporate Insight ⁽⁴⁾


	Three Months Ended December 31,						%		Twelve Months Ended December 31,						%
Financial Highlights	2024			2023			Change		2024			2023			Change

Net revenues (in millions)	$	5,329		$	4,459		20	%	$	19,606		$	18,837		4	%
Net income (in millions)
GAAP	$	1,840		$	1,045		76	%	$	5,942		$	5,067		17	%
Adjusted	$	1,974		$	1,367		44	%	$	6,433		$	6,159		4	%
Diluted earnings per common share
GAAP	$	.94		$	.51		84	%	$	2.99		$	2.54		18	%
Adjusted	$	1.01		$	.68		49	%	$	3.25		$	3.13		4	%
Pre-tax profit margin
GAAP		43.3	%		26.8	%				39.2	%		33.9	%
Adjusted		46.6	%		36.0	%				42.5	%		41.5	%
Return on average common stockholders’ equity (annualized)		18	%		12	%				15	%		16	%
Return on tangible common equity (annualized)		36	%		43	%				35	%		54	%

Note:

Items labeled "adjusted" are non-GAAP financial measures; further details on non-GAAP financial measures and a reconciliation of such measures to GAAP reported results are included on pages 10-12 of this release. All per-share results are rounded to the nearest cent, based on weighted-average diluted common shares outstanding.

4Q24 Financial Commentary

Net revenues grew on both a year-over-year and sequential basis, up 20% and 10%, respectively
Sequential net interest margin expanded by 25 basis points to 2.33%
Client transactional sweep cash balances ended at $418.6 billion, a sequential increase of $34.6 billion
Bank Supplemental Funding ⁽²⁾ declined sequentially by $14.9 billion to $49.9 billion at December month-end
Asset management and administration fees achieved a quarterly record of $1.5 billion
Trading revenue increased 14% versus 4Q23 as a result of higher volumes and changes in trading mix
GAAP expenses for the quarter declined 7% versus 4Q23
Fourth quarter acquisition and integration-related costs, amortization of acquired intangibles, and restructuring costs equaled $177 million; exclusive of these items, adjusted total expenses ⁽¹⁾ were flat year-over-year
Capital ratios across the firm continue to strengthen – including preliminary consolidated Tier 1 Leverage and adjusted Tier 1 Leverage ⁽¹⁾ reaching 9.9% and 6.8%, respectively
Results reflect certain items, including the resolution of previously accrued tax and legal reserves, which contributed $.03 to both GAAP and adjusted diluted earnings per share ⁽¹⁾

⁽¹⁾		Further details on non-GAAP financial measures and a reconciliation of such measures to GAAP reported results are included on pages 10-12 of this release.
⁽²⁾		Bank Supplemental Funding includes repurchase agreements at the banks, Schwab Bank Certificates of Deposit (CDs), and Federal Home Loan Bank balances.
⁽³⁾		Newsweek America’s Best Customer Service 2025 was given on October 30, 2024, and expires November 1, 2025. The criteria, evaluation, and ranking were determined by Newsweek, partnered with Statista. Visit https://d.newsweek.com/en/file/473784/newsweek-americas-best-customer-service-2025-methodology.pdf for more information. Schwab paid a licensing fee to Newsweek for use of the award and logos.
⁽⁴⁾		Schwab leads in mobile rankings in Corporate Insight’s 2024 Brokerage Experience Benchmarks (https://corporateinsight.com/the-2024-brokerage-experience-benchmarks), which evaluate the individual investor experience offered by 20 leading brokerage websites and mobile apps. This research was independently conducted by Corporate Insight using the Experience Benchmarks’ analytical frameworks that are built on over 25 years of research to provide a clear view of how the nation’s top brokerage websites and mobile apps stack up against one another in terms of functionality, design, navigation, and usability.

Winter Business Update

The company will host its Winter Business Update for institutional investors this morning from 7:30 a.m. - 8:30 a.m. CT, 8:30 a.m. - 9:30 a.m. ET.

Registration for this Update webcast is accessible at https://www.aboutschwab.com/schwabevents.

Forward-Looking Statements

This press release contains forward-looking statements relating to the company’s ongoing progress following the Ameritrade acquisition; asset gathering; client cash trends; competitive position; through-the-cycle profitability; and capital ratios. These forward-looking statements reflect management’s expectations as of the date hereof. Achievement of these expectations and objectives is subject to risks and uncertainties that could cause actual results to differ materially from the expressed expectations.

Important factors that may cause such differences are described in the company’s most recent reports on Form 10-K and Form 10-Q, which have been filed with the Securities and Exchange Commission and are available on the company’s website (https://www.aboutschwab.com/financial-reports) and on the Securities and Exchange Commission’s website (https://www.sec.gov). The company makes no commitment to update any forward-looking statements.

About Charles Schwab

The Charles Schwab Corporation (NYSE: SCHW) is a leading provider of financial services, with 36.5 million active brokerage accounts, 5.4 million workplace plan participant accounts, 2.0 million banking accounts, and $10.10 trillion in client assets. Through its operating subsidiaries, the company provides a full range of wealth management, securities brokerage, banking, asset management, custody, and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC, https://www.sipc.org), and its affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent, fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through Schwab Advisor Services. Its primary banking subsidiary, Charles Schwab Bank, SSB (member FDIC and an Equal Housing Lender), provides banking and lending services and products. More information is available at https://www.aboutschwab.com.

THE CHARLES SCHWAB CORPORATION
Consolidated Statements of Income
(In millions, except per share amounts)
(Unaudited)

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2024			2023			2024			2023
Net Revenues
Interest revenue	$	3,851		$	3,963		$	15,537		$	16,111
Interest expense		(1,320	)		(1,833	)		(6,393	)		(6,684	)
Net interest revenue		2,531			2,130			9,144			9,427
Asset management and administration fees		1,509			1,241			5,716			4,756
Trading revenue		873			767			3,264			3,230
Bank deposit account fees		241			174			729			705
Other		175			147			753			719
Total net revenues		5,329			4,459			19,606			18,837
Expenses Excluding Interest
Compensation and benefits		1,533			1,409			6,043			6,315
Professional services		297			253			1,053			1,058
Occupancy and equipment		276			331			1,060			1,254
Advertising and market development		101			104			397			397
Communications		131			144			591			629
Depreciation and amortization		224			238			916			804
Amortization of acquired intangible assets		130			130			519			534
Regulatory fees and assessments		89			270			398			547
Other		243			386			937			921
Total expenses excluding interest		3,024			3,265			11,914			12,459
Income before taxes on income		2,305			1,194			7,692			6,378
Taxes on income		465			149			1,750			1,311
Net Income		1,840			1,045			5,942			5,067
Preferred stock dividends and other		123			119			464			418
Net Income Available to Common Stockholders	$	1,717		$	926		$	5,478		$	4,649
Weighted-Average Common Shares Outstanding:
Basic		1,831			1,823			1,828			1,824
Diluted		1,836			1,828			1,834			1,831
Earnings Per Common Shares Outstanding ⁽¹⁾:
Basic	$	.94		$	.51		$	3.00		$	2.55
Diluted	$	.94		$	.51		$	2.99		$	2.54

⁽¹⁾		The Company has voting and nonvoting common stock outstanding. As the participation rights, including dividend and liquidation rights, are identical between the voting and nonvoting stock classes, basic and diluted earnings per share are the same for each class.

THE CHARLES SCHWAB CORPORATION
Financial and Operating Highlights
(Unaudited)
	Q4-24 % change				2024												2023
	vs.		vs.		Fourth			Third			Second			First			Fourth
(In millions, except per share amounts and as noted)	Q4-23		Q3-24		Quarter			Quarter			Quarter			Quarter			Quarter
Net Revenues
Net interest revenue	19	%	14	%	$	2,531		$	2,222		$	2,158		$	2,233		$	2,130
Asset management and administration fees	22	%	2	%		1,509			1,476			1,383			1,348			1,241
Trading revenue	14	%	10	%		873			797			777			817			767
Bank deposit account fees	39	%	59	%		241			152			153			183			174
Other	19	%	(13	)%		175			200			219			159			147
Total net revenues	20	%	10	%		5,329			4,847			4,690			4,740			4,459
Expenses Excluding Interest
Compensation and benefits ⁽¹⁾	9	%	1	%		1,533			1,522			1,450			1,538			1,409
Professional services	17	%	16	%		297			256			259			241			253
Occupancy and equipment	(17	)%	2	%		276			271			248			265			331
Advertising and market development	(3	)%	—			101			101			107			88			104
Communications	(9	)%	(11	)%		131			147			172			141			144
Depreciation and amortization	(6	)%	(3	)%		224			231			233			228			238
Amortization of acquired intangible assets	—		—			130			130			129			130			130
Regulatory fees and assessments	(67	)%	1	%		89			88			96			125			270
Other ⁽²⁾	(37	)%	(6	)%		243			259			249			186			386
Total expenses excluding interest	(7	)%	1	%		3,024			3,005			2,943			2,942			3,265
Income before taxes on income	93	%	25	%		2,305			1,842			1,747			1,798			1,194
Taxes on income	N/M		7	%		465			434			415			436			149
Net Income	76	%	31	%		1,840			1,408			1,332			1,362			1,045
Preferred stock dividends and other	3	%	13	%		123			109			121			111			119
Net Income Available to Common Stockholders	85	%	32	%	$	1,717		$	1,299		$	1,211		$	1,251		$	926
Earnings per common share ⁽³⁾:
Basic	84	%	32	%	$	.94		$	.71		$	.66		$	.69		$	.51
Diluted	84	%	32	%	$	.94		$	.71		$	.66		$	.68		$	.51
Dividends declared per common share	—		—		$	.25		$	.25		$	.25		$	.25		$	.25
Weighted-average common shares outstanding:
Basic	—		—			1,831			1,829			1,828			1,825			1,823
Diluted	—		—			1,836			1,834			1,834			1,831			1,828
Performance Measures
Pre-tax profit margin						43.3	%		38.0	%		37.2	%		37.9	%		26.8	%
Return on average common stockholders’ equity (annualized) ⁽⁴⁾						18	%		14	%		14	%		15	%		12	%
Financial Condition (at quarter end, in billions)
Cash and cash equivalents	(3	)%	21	%	$	42.1		$	34.9		$	25.4		$	31.8		$	43.3
Cash and investments segregated	20	%	13	%		38.2			33.7			21.7			25.9			31.8
Receivables from brokerage clients — net	24	%	15	%		85.4			74.0			72.8			71.2			68.7
Available for sale securities	(23	)%	(8	)%		83.0			90.0			93.6			101.1			107.6
Held to maturity securities	(8	)%	(2	)%		146.5			149.9			153.2			156.4			159.5
Bank loans — net	12	%	4	%		45.2			43.3			42.2			40.8			40.4
Total assets	(3	)%	3	%		479.8			466.1			449.7			468.8			493.2
Bank deposits	(11	)%	5	%		259.1			246.5			252.4			269.5			290.0
Payables to brokers, dealers, and clearing organizations⁽⁵⁾	102	%	(19	)%		13.3			16.4			5.9			6.7			6.6
Payables to brokerage clients	20	%	14	%		101.6			89.2			80.0			84.0			84.8
Other short-term borrowings	(9	)%	(43	)%		6.0			10.6			10.0			8.4			6.6
Federal Home Loan Bank borrowings	(37	)%	(26	)%		16.7			22.6			24.4			24.0			26.4
Long-term debt	(14	)%	—			22.4			22.4			22.4			22.9			26.1
Stockholders’ equity	18	%	3	%		48.4			47.2			44.0			42.4			41.0
Other
Full-time equivalent employees (at quarter end, in thousands)	(3	)%	—			32.1			32.1			32.3			32.6			33.0
Capital expenditures — purchases of equipment, office facilities, and property, net (in millions)	30	%	91	%	$	258		$	135		$	92		$	122		$	199
Expenses excluding interest as a percentage of average client assets (annualized)						0.12	%		0.12	%		0.13	%		0.14	%		0.16	%
Clients’ Daily Average Trades (DATs) (in thousands)	22	%	11	%		6,312			5,697			5,486			5,958			5,192
Number of Trading Days	1	%	(1	)%		63.0			63.5			63.0			61.0			62.5
Revenue Per Trade ⁽⁶⁾	(7	)%	—		$	2.20		$	2.20		$	2.25		$	2.25		$	2.36

⁽¹⁾		Fourth quarter of 2023 includes $16 million in restructuring costs.
⁽²⁾		Fourth quarter of 2023 includes $181 million in restructuring costs.
⁽³⁾		The Company has voting and nonvoting common stock outstanding. As the participation rights, including dividend and liquidation rights, are identical between the voting and nonvoting stock classes, basic and diluted earnings per share are the same for each class.
⁽⁴⁾		Return on average common stockholders’ equity is calculated using net income available to common stockholders divided by average common stockholders’ equity.
⁽⁵⁾		Payables to brokers, dealers, and clearing organizations include securities loaned.
⁽⁶⁾		Revenue per trade is calculated as trading revenue divided by the product of DATs multiplied by the number of trading days.
N/M Not meaningful. Percentage changes greater than 200% are presented as not meaningful.

THE CHARLES SCHWAB CORPORATION
Net Interest Revenue Information
(In millions, except ratios or as noted)
(Unaudited)
	Three Months Ended December 31,												Twelve Months Ended December 31,
	2024						2023						2024						2023
	Average Balance		Interest Revenue/ Expense		Average Yield/ Rate		Average Balance		Interest Revenue/ Expense		Average Yield/ Rate		Average Balance		Interest Revenue/ Expense		Average Yield/ Rate		Average Balance		Interest Revenue/ Expense		Average Yield/ Rate
Interest-earning assets
Cash and cash equivalents	$	28,332	$	334	4.61	%	$	35,312	$	475	5.27	%	$	29,676	$	1,539	5.10	%	$	37,846	$	1,894	4.94	%
Cash and investments segregated		36,510		429	4.60	%		23,830		314	5.16	%		28,450		1,443	4.99	%		28,259		1,355	4.73	%
Receivables from brokerage clients		77,524		1,378	6.95	%		62,602		1,260	7.88	%		70,811		5,420	7.53	%		61,914		4,793	7.64	%
Available for sale securities ⁽¹⁾		92,216		486	2.09	%		118,831		647	2.16	%		101,659		2,166	2.12	%		137,178		2,987	2.17	%
Held to maturity securities ⁽¹⁾		147,608		638	1.72	%		160,378		700	1.74	%		152,566		2,636	1.72	%		165,634		2,872	1.73	%
Bank loans		44,248		483	4.36	%		40,386		437	4.31	%		42,255		1,867	4.42	%		40,234		1,664	4.14	%
Total interest-earning assets		426,438		3,748	3.46	%		441,339		3,833	3.43	%		425,417		15,071	3.51	%		471,065		15,565	3.28	%
Securities lending revenue				72						78						330						419
Other interest revenue				31						52						136						127
Total interest-earning assets	$	426,438	$	3,851	3.56	%	$	441,339	$	3,963	3.54	%	$	425,417	$	15,537	3.61	%	$	471,065	$	16,111	3.39	%
Funding sources
Bank deposits	$	244,176	$	550	0.90	%	$	280,380	$	971	1.37	%	$	256,212	$	3,152	1.23	%	$	306,505	$	3,363	1.10	%
Payables to brokers, dealers, and clearing organizations ⁽²⁾		13,045		142	4.28	%		5,386		51	3.72	%		8,522		372	4.30	%		4,477		147	3.23	%
Payables to brokerage clients		82,279		43	0.21	%		61,781		66	0.43	%		72,776		272	0.37	%		66,842		271	0.41	%
Other short-term borrowings		9,094		122	5.33	%		6,724		95	5.63	%		9,146		504	5.51	%		7,144		375	5.25	%
Federal Home Loan Bank borrowings		19,392		257	5.18	%		31,630		423	5.28	%		23,102		1,245	5.32	%		34,821		1,810	5.14	%
Long-term debt		22,438		206	3.67	%		25,457		226	3.54	%		23,083		846	3.66	%		22,636		715	3.16	%
Total interest-bearing liabilities ⁽²⁾		390,424		1,320	1.34	%		411,358		1,832	1.77	%		392,841		6,391	1.62	%		442,425		6,681	1.51	%
Non-interest-bearing funding sources ⁽²⁾		36,014						29,981						32,576						28,640
Other interest expense				—						1						2						3
Total funding sources	$	426,438	$	1,320	1.23	%	$	441,339	$	1,833	1.65	%	$	425,417	$	6,393	1.49	%	$	471,065	$	6,684	1.41	%
Net interest revenue			$	2,531	2.33	%			$	2,130	1.89	%			$	9,144	2.12	%			$	9,427	1.98	%

⁽¹⁾		Amounts have been calculated based on amortized cost.
⁽²⁾		Beginning in 2024, payables to brokers, dealers, and clearing organizations is presented separately from non-interest-bearing funding sources and included in total interest-bearing liabilities. This line item includes securities loaned and related interest expense. Prior period amounts have been reclassified to reflect this change.

THE CHARLES SCHWAB CORPORATION
Asset Management and Administration Fees Information
(In millions, except ratios or as noted)
(Unaudited)

	Three Months Ended December 31,												Twelve Months Ended December 31,
	2024						2023						2024						2023
	Average Client Assets		Revenue		Average Fee		Average Client Assets		Revenue		Average Fee		Average Client Assets		Revenue		Average Fee		Average Client Assets		Revenue		Average Fee
Schwab money market funds	$	580,957	$	389	0.27	%	$	461,091	$	299	0.26	%	$	539,113	$	1,461	0.27	%	$	391,864	$	1,034	0.26	%
Schwab equity and bond funds, exchange-traded funds (ETFs), and collective trust funds (CTFs)		647,170		125	0.08	%		486,340		98	0.08	%		588,999		462	0.08	%		471,832		382	0.08	%
Mutual Fund OneSource^® and other no-transaction- fee funds		363,024		231	0.25	%		289,841		188	0.26	%		342,615		878	0.26	%		249,131		657	0.26	%
Other third-party mutual funds and ETFs		629,913		106	0.07	%		572,027		97	0.07	%		611,999		420	0.07	%		640,689		490	0.08	%
Total mutual funds, ETFs, and CTFs⁽¹⁾	$	2,221,064	$	851	0.15	%	$	1,809,299	$	682	0.15	%	$	2,082,726	$	3,221	0.15	%	$	1,753,516	$	2,563	0.15	%
Managed investing solutions ⁽¹⁾
Fee-based	$	582,464	$	557	0.38	%	$	465,266	$	475	0.41	%	$	542,253	$	2,129	0.39	%	$	458,114	$	1,868	0.41	%
Non-fee-based		115,712		—	—			98,679		—	—			111,571		—	—			96,633		—	—
Total managed investing solutions	$	698,176	$	557	0.32	%	$	563,945	$	475	0.33	%	$	653,824	$	2,129	0.33	%	$	554,747	$	1,868	0.34	%
Other balance-based fees ⁽²⁾		827,930		76	0.04	%		664,774		65	0.04	%		776,715		286	0.04	%		608,170		254	0.04	%
Other ⁽³⁾				25						19						80						71
Total asset management and administration fees			$	1,509					$	1,241					$	5,716					$	4,756

⁽¹⁾		Managed investing solutions, formerly referred to as "Advice solutions", includes managed portfolios, specialized strategies, and customized investment advice such as Schwab Wealth Advisory™, Schwab Managed Portfolios™, Managed Account Select^®, Schwab Advisor Network^®, Windhaven Strategies^®, ThomasPartners^® Strategies, Wasmer Schroeder™ Strategies, Schwab Index Advantage advised retirement plan balances, Schwab Intelligent Portfolios^®, Institutional Intelligent Portfolios^®, Schwab Intelligent Portfolios Premium^®, AdvisorDirect^®, Essential Portfolios, Selective Portfolios, and Personalized Portfolios; as well as legacy non-fee managed investing solutions including Schwab Advisor Source and certain retirement plan balances. Average client assets for managed investing solutions may also include the asset balances contained in the mutual fund and/or ETF categories listed above. For the total end of period view, please see the Monthly Activity Report.
⁽²⁾		Includes various asset-related fees, such as trust fees, 401(k) recordkeeping fees, and mutual fund clearing fees and other service fees.
⁽³⁾		Includes miscellaneous service and transaction fees relating to mutual funds and ETFs that are not balance-based.

THE CHARLES SCHWAB CORPORATION
Growth in Client Assets and Accounts
(Unaudited)

	Q4-24 % Change				2024												2023
	vs.		vs.		Fourth			Third			Second			First			Fourth
(In billions, at quarter end, except as noted)	Q4-23		Q3-24		Quarter			Quarter			Quarter			Quarter			Quarter
Assets in client accounts
Schwab One^®, certain cash equivalents, and bank deposits	(3	)%	7	%	$	358.8		$	334.1		$	330.7		$	348.2		$	368.3
Bank deposit account balances	(10	)%	4	%		87.5			84.0			84.5			90.2			97.4
Proprietary mutual funds (Schwab Funds^® and Laudus Funds^®) and CTFs
Money market funds ⁽¹⁾	25	%	6	%		596.5			562.1			533.6			515.7			476.4
Equity and bond funds and CTFs ⁽²⁾	24	%	1	%		232.2			228.9			214.4			206.0			186.7
Total proprietary mutual funds and CTFs	25	%	5	%		828.7			791.0			748.0			721.7			663.1
Mutual Fund Marketplace^{® (3)}
Mutual Fund OneSource^® and other no-transaction-fee funds	14	%	(3	)%		347.8			358.0			344.8			329.2			306.2
Mutual fund clearing services	20	%	—			280.7			280.8			264.7			248.1			233.4
Other third-party mutual funds	8	%	(2	)%		1,211.1			1,236.5			1,177.5			1,182.9			1,126.5
Total Mutual Fund Marketplace	10	%	(2	)%		1,839.6			1,875.3			1,787.0			1,760.2			1,666.1
Total mutual fund assets	15	%	—			2,668.3			2,666.3			2,535.0			2,481.9			2,329.2
Exchange-traded funds
Proprietary ETFs ⁽²⁾	24	%	2	%		395.0			385.9			349.6			342.9			319.4
Other third-party ETFs	28	%	3	%		1,940.6			1,888.2			1,738.6			1,676.6			1,521.7
Total ETF assets	27	%	3	%		2,335.6			2,274.1			2,088.2			2,019.5			1,841.1
Equity and other securities	26	%	3	%		3,972.6			3,839.6			3,648.8			3,467.7			3,163.5
Fixed income securities	(2	)%	(4	)%		762.3			795.4			792.0			779.0			779.7
Margin loans outstanding	34	%	15	%		(83.8	)		(73.0	)		(71.7	)		(68.1	)		(62.6	)
Total client assets	19	%	2	%	$	10,101.3		$	9,920.5		$	9,407.5		$	9,118.4		$	8,516.6
Client assets by business⁽⁴⁾
Investor Services ⁽⁵⁾	20	%	3	%	$	5,721.6		$	5,576.7		$	5,317.5		$	5,108.9		$	4,759.2
Advisor Services ⁽⁶⁾	17	%	1	%		4,379.7			4,343.8			4,090.0			4,009.5			3,757.4
Total client assets	19	%	2	%	$	10,101.3		$	9,920.5		$	9,407.5		$	9,118.4		$	8,516.6
Net growth in assets in client accounts (for the quarter ended)
Net new assets by business ⁽⁴⁾
Investor Services ⁽⁵⁾	64	%	24	%	$	46.2		$	37.2		$	40.1		$	37.6		$	28.1
Advisor Services ⁽⁶⁾	63	%	16	%		62.2			53.6			34.1			50.6			38.2
Total net new assets	63	%	19	%	$	108.4		$	90.8		$	74.2		$	88.2		$	66.3
Net market gains						72.4			422.2			214.9			513.6			625.8
Net growth					$	180.8		$	513.0		$	289.1		$	601.8		$	692.1
New brokerage accounts (in thousands, for the quarter ended)	23	%	15	%		1,119			972			985			1,094			910
Client accounts (in thousands)
Active brokerage accounts	5	%	1	%		36,456			35,982			35,612			35,301			34,838
Banking accounts	9	%	2	%		1,998			1,954			1,931			1,885			1,838
Workplace Plan Participant Accounts ⁽⁷⁾	3	%	—			5,399			5,388			5,363			5,277			5,221

⁽¹⁾		Total client assets in purchased money market funds are located at: https://www.aboutschwab.com/investor-relations.
⁽²⁾		Includes balances held on and off the Schwab platform. As of December 31, 2024, off-platform equity and bond funds, CTFs, and ETFs were $35.0 billion, $3.9 billion, and $139.0 billion, respectively.
⁽³⁾		Excludes all proprietary mutual funds and ETFs.
⁽⁴⁾		In the fourth quarter of 2024, Retirement Business Services moved from Advisor Services to Investor Services. Prior periods have been recast.
⁽⁵⁾		Fourth quarter of 2024 includes net outflows of $5.5 billion from off-platform Schwab Bank Retail CDs and an outflow of $0.6 billion from a large international relationship. Third quarter of 2024 includes net outflows of $4.4 billion from off-platform Schwab Bank Retail CDs and an outflow of $0.1 billion from a large international relationship. Second quarter of 2024 includes net inflows of $2.7 billion from off-platform Schwab Bank Retail CDs and an inflow of $10.3 billion from a mutual fund clearing services client. First quarter of 2024 includes net outflows of $7.4 billion from off-platform Schwab Bank Retail CDs. Fourth quarter of 2023 includes net inflows of $2.4 billion from off-platform Schwab Bank Retail CDs and outflows of $5.8 billion from a large international relationship.
⁽⁶⁾		Fourth quarter of 2024 includes an outflow of $0.3 billion from a large international relationship. Fourth quarter of 2023 includes outflows of $6.4 billion from a large international relationship.
⁽⁷⁾		Includes Retirement Plan Services, Stock Plan Services, Designated Brokerage Services, and Retirement Business Services. Participants may be enrolled in services in more than one Workplace business.

The Charles Schwab Corporation Monthly Activity Report For December 2024

	2023		2024																								Change
	Dec		Jan		Feb		Mar		Apr		May		Jun		Jul		Aug		Sep		Oct		Nov		Dec		Mo.		Yr.
Market Indices (at month end)
Dow Jones Industrial Average^®	37,690		38,150		38,996		39,807		37,816		38,686		39,119		40,843		41,563		42,330		41,763		44,911		42,544		(5	)%	13	%
Nasdaq Composite^®	15,011		15,164		16,092		16,379		15,658		16,735		17,733		17,599		17,714		18,189		18,095		19,218		19,311		—		29	%
Standard & Poor’s^® 500	4,770		4,846		5,096		5,254		5,036		5,278		5,460		5,522		5,648		5,762		5,705		6,032		5,882		(2	)%	23	%
Client Assets (in billions of dollars)
Beginning Client Assets	8,180.6		8,516.6		8,558.1		8,879.5		9,118.4		8,847.5		9,206.3		9,407.5		9,572.1		9,737.7		9,920.5		9,852.0		10,305.4
Net New Assets⁽¹⁾	42.1		14.8		31.7		41.7		10.0		31.0		33.2		29.0		31.5		30.3		22.7		25.5		60.2		136	%	43	%
Net Market Gains (Losses)	293.9		26.7		289.7		197.2		(280.9	)	327.8		168.0		135.6		134.1		152.5		(91.2	)	427.9		(264.3	)
Total Client Assets (at month end)	8,516.6		8,558.1		8,879.5		9,118.4		8,847.5		9,206.3		9,407.5		9,572.1		9,737.7		9,920.5		9,852.0		10,305.4		10,101.3		(2	)%	19	%
Core Net New Assets^(1,2)	43.1		17.2		33.4		45.0		1.0		31.1		29.1		29.0		32.8		33.5		24.6		28.8		61.4		113	%	42	%
Receiving Ongoing Advisory Services (at month end)
Investor Services	581.4		584.1		601.8		618.5		602.2		624.0		632.9		649.1		663.7		675.1		665.6		688.9		682.0		(1	)%	17	%
Advisor Services	3,757.4		3,780.4		3,902.5		4,009.5		3,893.9		4,027.3		4,090.0		4,185.4		4,268.1		4,343.8		4,303.3		4,489.2		4,379.7		(2	)%	17	%
Client Accounts (at month end, in thousands)
Active Brokerage Accounts	34,838		35,017		35,127		35,301		35,426		35,524		35,612		35,743		35,859		35,982		36,073		36,222		36,456		1	%	5	%
Banking Accounts	1,838		1,856		1,871		1,885		1,901		1,916		1,931		1,937		1,940		1,954		1,967		1,980		1,998		1	%	9	%
Workplace Plan Participant Accounts⁽³⁾	5,221		5,226		5,268		5,277		5,282		5,345		5,363		5,382		5,373		5,388		5,407		5,393		5,399		—		3	%
Client Activity
New Brokerage Accounts (in thousands)	340		366		345		383		361		314		310		327		324		321		331		357		431		21	%	27	%
Client Cash as a Percentage of Client Assets⁽⁴⁾	10.5	%	10.5	%	10.2	%	10.0	%	10.2	%	9.9	%	9.7	%	9.6	%	9.5	%	9.5	%	9.8	%	9.5	%	10.1	%	60 bp		(40) bp
Derivative Trades as a Percentage of Total Trades	21.8	%	21.8	%	22.2	%	21.9	%	22.1	%	21.9	%	21.3	%	21.2	%	20.8	%	21.5	%	21.4	%	19.7	%	18.6	%	(110) bp		(320) bp
Selected Average Balances (in millions of dollars)
Average Interest-Earning Assets ⁽⁵⁾	446,305		443,694		434,822		431,456		423,532		415,950		417,150		417,379		420,191		420,203		422,327		425,789		431,177		1	%	(3	)%
Average Margin Balances	62,309		61,368		63,600		66,425		68,827		67,614		69,730		73,206		73,326		72,755		74,105		76,932		81,507		6	%	31	%
Average Bank Deposit Account Balances ⁽⁶⁾	95,518		95,553		92,075		90,774		88,819		86,844		85,195		83,979		82,806		82,336		83,261		84,385		85,384		1	%	(11	)%
Mutual Fund and Exchange-Traded Fund
Net Buys (Sells)^(7,8) (in millions of dollars)
Equities	7,903		8,182		7,624		10,379		3,472		5,734		3,379		10,908		5,609		5,217		7,176		13,226		14,805
Hybrid	(1,596	)	(501	)	(1,330	)	(439	)	(703	)	(558	)	(843	)	(1,155	)	(1,377	)	(432	)	(1,397	)	(329	)	124
Bonds	6,104		7,510		9,883		7,561		5,949		5,854		6,346		8,651		10,919		11,015		10,442		7,473		10,969
Net Buy (Sell) Activity (in millions of dollars)
Mutual Funds ⁽⁷⁾	(7,406	)	(966	)	(1,348	)	(1,607	)	(4,818	)	(5,544	)	(4,254	)	(4,679	)	(4,003	)	(1,261	)	(4,905	)	(4,492	)	(4,331	)
Exchange-Traded Funds ⁽⁸⁾	19,817		16,157		17,525		19,108		13,536		16,574		13,136		23,083		19,154		17,061		21,126		24,862		30,229
Money Market Funds	7,745		11,717		10,129		9,085		(2,357	)	9,790		3,858		9,110		8,048		9,672		11,032		9,172		8,956

Note: Certain supplemental details related to the information above can be found at: https://www.aboutschwab.com/financial-reports.
⁽¹⁾		Unless otherwise noted, differences between net new assets and core net new assets are net flows from off-platform Schwab Bank Retail CDs. Additionally, 2024 includes outflows from a large international relationship of $0.1 billion in August, $0.3 billion in October, $0.6 billion in November, and an inflow of $10.3 billion from a mutual fund clearing services client in April. 2023 also includes an outflow from a large international relationship of $0.6 billion in December.
⁽²⁾		Net new assets before significant one-time inflows or outflows, such as acquisitions/divestitures or extraordinary flows (generally greater than $10 billion) relating to a specific client, and activity from off-platform Schwab Bank Retail CDs. These flows may span multiple reporting periods.
⁽³⁾		Includes Retirement Plan Services, Stock Plan Services, Designated Brokerage Services, and Retirement Business Services. Participants may be enrolled in services in more than one Workplace business.
⁽⁴⁾		Schwab One^®, certain cash equivalents, bank deposits, third-party bank deposit accounts, and money market fund balances as a percentage of total client assets; client cash excludes brokered CDs issued by Charles Schwab Bank.
⁽⁵⁾		Represents average total interest-earning assets on the Company’s balance sheet.
⁽⁶⁾		Represents average clients’ uninvested cash sweep account balances held in deposit accounts at third-party financial institutions.
⁽⁷⁾		Represents the principal value of client mutual fund transactions handled by Schwab, including transactions in proprietary funds. Includes institutional funds available only to Investment Managers. Excludes money market fund transactions.
⁽⁸⁾		Represents the principal value of client ETF transactions handled by Schwab, including transactions in proprietary ETFs.

THE CHARLES SCHWAB CORPORATION
Non-GAAP Financial Measures
(In millions, except ratios and per share amounts)
(Unaudited)

In addition to disclosing financial results in accordance with generally accepted accounting principles in the U.S. (GAAP), Schwab’s fourth quarter earnings release contains references to the non-GAAP financial measures described below. We believe these non-GAAP financial measures provide useful supplemental information about the financial performance of the Company, and facilitate meaningful comparison of Schwab’s results in the current period to both historic and future results. These non-GAAP measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may not be comparable to non-GAAP financial measures presented by other companies.

Schwab’s use of non-GAAP measures is reflective of certain adjustments made to GAAP financial measures as described below. Beginning in the third quarter of 2023, these adjustments also include restructuring costs, which the Company began incurring in connection with its previously announced plans to streamline its operations to prepare for post-integration of Ameritrade. See Part I – Item 1 – Note 10 of our Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 for additional information.

Non-GAAP Adjustment or Measure	Definition	Usefulness to Investors and Uses by Management
Acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs	Schwab adjusts certain GAAP financial measures to exclude the impact of acquisition and integration-related costs incurred as a result of the Company’s acquisitions, amortization of acquired intangible assets, restructuring costs, and, where applicable, the income tax effect of these expenses. Adjustments made to exclude amortization of acquired intangible assets are reflective of all acquired intangible assets, which were recorded as part of purchase accounting. These acquired intangible assets contribute to the Company’s revenue generation. Amortization of acquired intangible assets will continue in future periods over their remaining useful lives.	We exclude acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs for the purpose of calculating certain non-GAAP measures because we believe doing so provides additional transparency of Schwab’s ongoing operations, and is useful in both evaluating the operating performance of the business and facilitating comparison of results with prior and future periods. Costs related to acquisition and integration or restructuring fluctuate based on the timing of acquisitions, integration and restructuring activities, thereby limiting comparability of results among periods, and are not representative of the costs of running the Company’s ongoing business. Amortization of acquired intangible assets is excluded because management does not believe it is indicative of the Company’s underlying operating performance.
Return on tangible common equity	Return on tangible common equity represents annualized adjusted net income available to common stockholders as a percentage of average tangible common equity. Tangible common equity represents common equity less goodwill, acquired intangible assets — net, and related deferred tax liabilities.	Acquisitions typically result in the recognition of significant amounts of goodwill and acquired intangible assets. We believe return on tangible common equity may be useful to investors as a supplemental measure to facilitate assessing capital efficiency and returns relative to the composition of Schwab’s balance sheet.
Adjusted Tier 1 Leverage Ratio	Adjusted Tier 1 Leverage Ratio represents the Tier 1 Leverage Ratio as prescribed by bank regulatory guidance for the consolidated company and for Charles Schwab Bank, SSB (CSB), adjusted to reflect the inclusion of accumulated other comprehensive income (AOCI) in the ratio.	Inclusion of the impacts of AOCI in the Company’s Tier 1 Leverage Ratio provides additional information regarding the Company’s current capital position. We believe Adjusted Tier 1 Leverage Ratio may be useful to investors as a supplemental measure of the Company’s capital levels.

The Company also uses adjusted diluted EPS and return on tangible common equity as components of performance criteria for employee bonus and certain executive management incentive compensation arrangements. The Compensation Committee of CSC’s Board of Directors maintains discretion in evaluating performance against these criteria. Additionally, the Company uses adjusted Tier 1 Leverage Ratio in managing capital, including its use of the measure as its long-term operating objective.

The tables below present reconciliations of GAAP measures to non-GAAP measures:
	Three Months Ended December 31,												Twelve Months Ended December 31,
	2024						2023						2024						2023
	Total Expenses Excluding Interest			Net Income			Total Expenses Excluding Interest			Net Income			Total Expenses Excluding Interest			Net Income			Total Expenses Excluding Interest			Net Income
Total expenses excluding interest (GAAP), Net income (GAAP)	$	3,024		$	1,840		$	3,265		$	1,045		$	11,914		$	5,942		$	12,459		$	5,067
Acquisition and integration-related costs ⁽¹⁾		(20	)		20			(67	)		67			(117	)		117			(401	)		401
Amortization of acquired intangible assets		(130	)		130			(130	)		130			(519	)		519			(534	)		534
Restructuring costs ⁽²⁾		(27	)		27			(216	)		216			(9	)		9			(495	)		495
Income tax effects ⁽³⁾		N/A			(43	)		N/A			(91	)		N/A			(154	)		N/A			(338	)
Adjusted total expenses (non-GAAP), Adjusted net income (non-GAAP)	$	2,847		$	1,974		$	2,852		$	1,367		$	11,269		$	6,433		$	11,029		$	6,159

⁽¹⁾		Acquisition and integration-related costs for the three and twelve months ended December 31, 2024 primarily consist of $10 million and $54 million of compensation and benefits, $4 million and $36 million of professional services, and $6 million and $19 million of depreciation and amortization. Acquisition and integration-related costs for the three and twelve months ended December 31, 2023 primarily consist of $29 million and $187 million of compensation and benefits, $24 million and $135 million of professional services, $7 million and $28 million of occupancy and equipment, and $1 million and $27 million of other expense.
⁽²⁾		Restructuring costs for the three months ended December 31, 2024 primarily consist of $24 million of other expense. Restructuring costs for the twelve months ended December 31, 2024 reflect a change in estimate of $34 million in compensation and benefits, offset by $5 million of occupancy and equipment and $37 million of other expense. Restructuring costs for the three and twelve months ended December 31, 2023 primarily consist of $16 million and $292 million of compensation and benefits, $15 million and $17 million of occupancy and equipment, and $181 million of other expense for each period.
⁽³⁾		The income tax effects of the non-GAAP adjustments are determined using an effective tax rate reflecting the exclusion of non-deductible acquisition costs and are used to present the acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs on an after-tax basis.
N/A Not applicable.

	Three Months Ended December 31,								Twelve Months Ended December 31,
	2024				2023				2024				2023
	Amount		% of Total Net Revenues		Amount		% of Total Net Revenues		Amount		% of Total Net Revenues		Amount		% of Total Net Revenues
Income before taxes on income (GAAP), Pre-tax profit margin (GAAP)	$	2,305	43.3	%	$	1,194	26.8	%	$	7,692	39.2	%	$	6,378	33.9	%
Acquisition and integration-related costs		20	0.4	%		67	1.5	%		117	0.6	%		401	2.1	%
Amortization of acquired intangible assets		130	2.4	%		130	2.9	%		519	2.7	%		534	2.9	%
Restructuring costs		27	0.5	%		216	4.8	%		9	—			495	2.6	%
Adjusted income before taxes on income (non-GAAP), Adjusted pre-tax profit margin (non-GAAP)	$	2,482	46.6	%	$	1,607	36.0	%	$	8,337	42.5	%	$	7,808	41.5	%

	Three Months Ended December 31,												Twelve Months Ended December 31,
	2024						2023						2024						2023
	Amount			Diluted EPS			Amount			Diluted EPS			Amount			Diluted EPS			Amount			Diluted EPS
Net income available to common stockholders (GAAP), Earnings per common share — diluted (GAAP)	$	1,717		$	.94		$	926		$	.51		$	5,478		$	2.99		$	4,649		$	2.54
Acquisition and integration-related costs		20			.01			67			.04			117			.06			401			.22
Amortization of acquired intangible assets		130			.07			130			.07			519			.28			534			.29
Restructuring costs		27			.01			216			.12			9			—			495			.27
Income tax effects		(43	)		(.02	)		(91	)		(.06	)		(154	)		(.08	)		(338	)		(.19	)
Adjusted net income available to common stockholders (non-GAAP), Adjusted diluted EPS (non-GAAP)	$	1,851		$	1.01		$	1,248		$	.68		$	5,969		$	3.25		$	5,741		$	3.13

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2024			2023			2024			2023
Return on average common stockholders’ equity (GAAP)		18	%		12	%		15	%		16	%
Average common stockholders’ equity	$	38,604		$	30,179		$	35,475		$	29,334
Less: Average goodwill		(11,951	)		(11,951	)		(11,951	)		(11,951	)
Less: Average acquired intangible assets — net		(7,808	)		(8,325	)		(8,002	)		(8,524	)
Plus: Average deferred tax liabilities related to goodwill and acquired intangible assets — net		1,723			1,790			1,741			1,805
Average tangible common equity	$	20,568		$	11,693		$	17,263		$	10,664
Adjusted net income available to common stockholders ⁽¹⁾	$	1,851		$	1,248		$	5,969		$	5,741
Return on tangible common equity (non-GAAP)		36	%		43	%		35	%		54	%

⁽¹⁾		See table above for the reconciliation of net income available to common stockholders to adjusted net income available to common stockholders (non-GAAP).

	(Preliminary)
	December 31, 2024
	CSC			CSB
Tier 1 Leverage Ratio (GAAP)		9.9	%		11.6	%
Tier 1 Capital	$	45,186		$	32,584
Plus: AOCI adjustment		(14,839	)		(12,938	)
Adjusted Tier 1 Capital		30,347			19,646
Average assets with regulatory adjustments		458,119			280,701
Plus: AOCI adjustment		(14,831	)		(13,037	)
Adjusted average assets with regulatory adjustments	$	443,288		$	267,664
Adjusted Tier 1 Leverage Ratio (non-GAAP)		6.8	%		7.3	%

View source version on businesswire.com: https://www.businesswire.com/news/home/20250121070609/en/

Contacts

MEDIA
Mayura Hooper, 415-667-1525
public.relations@schwab.com

INVESTORS/ANALYSTS
Jeff Edwards, 817-854-6177
investor.relations@schwab.com

Terms and Privacy Policy

Your Privacy Choices

Utah Privacy Notice

News

Life

Entertainment

Finance

Sports

New on Yahoo

Yahoo Finance

In This Article:

Recommended Stories