Charles Schwab Sees 2026 Revenue and NIM Growth at Lower End of Guidance
Charles Schwab Corp (NYSE:SCHW) expects full-year revenue growth and net interest margin expansion to arrive at the lower end of its target ranges, management announced during its third-quarter earnings call. The firm had previously guided for 2026 revenue growth between 17.5% and 18.5%, alongside net interest margin expansion into the 3.00% to 3.10% range. Shares of the company fell more than 2% in Thursday trading following the update.
The shift comes as third-quarter revenue fell short of expectations, despite earnings surpassing consensus estimates. On the cost side, expenses are also projected to finish at the bottom of the previously estimated 9.5% to 10.5% range. Executive leadership reiterated plans to generate around 800 basis points of operating leverage and maintain mid-teens earnings-per-share growth through the full market cycle.
Looking ahead to the fourth quarter of 2026, net interest margin is expected to expand by approximately 25 basis points compared to the prior-year quarter. Growth in lending balances, which currently exceed the firm's securities portfolio, continues to provide underlying support for net interest margin performance.
Key points
- Charles Schwab Corp (NYSE:SCHW) expects 2026 revenue growth and net interest margin near the bottom of previous ranges.
- Full-year expense growth is also projected at the lower end of the earlier 9.5% to 10.5% target.
- The company aims for mid-teens earnings per share growth through the cycle and 800 basis points of operating leverage.
- Fourth-quarter net interest margin is expected to expand by roughly 25 basis points year over year.
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Why did Charles Schwab stock fall?
Shares fell after the company announced that full-year 2026 revenue growth and net interest margin expansion are expected to reach the lower end of its previous guidance ranges.
What is Charles Schwab's updated revenue and margin outlook?
Schwab expects 2026 revenue growth and net interest margin near the lower end of its previous ranges of 17.5% to 18.5% and 3.00% to 3.10%, respectively, while expenses are also expected at the lower end of 9.5% to 10.5%.
What are Charles Schwab's expectations for fourth-quarter NIM?
Management expects fourth-quarter net interest margin to expand by about 25 basis points compared to the year-ago quarter, supported by lending balances exceeding its securities portfolio.