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Morgan Stanley Beats Q3 Estimates as Equity Trading Revenue Surges 41%

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MS$180.62 −3.23%

Morgan Stanley (MS) topped Wall Street expectations for the third quarter, delivering net revenues of $20.338 billion, up 11.6% from a year ago. Diluted earnings per share reached $3.03, rising from $2.80 in the previous year and exceeding forecasts. Net income for the quarter rose to $4.9 billion from $4.6 billion.

The bank's strong performance was anchored by an institutional trading rally and steady wealth management gains. Equity trading revenue jumped 41% to $5.799 billion, lifting total Institutional Securities revenue to $10.0 billion. Wealth Management generated a record $9.1 billion in net revenues with a 30.4% pre-tax margin, attracting $232 billion in net new assets. Meanwhile, net interest income increased 30% to $3.25 billion, helping offset a 7% decline in fixed-income revenue and a provision for credit losses of $141 million.

Despite the stronger-than-expected quarterly results, shares of the investment bank were down 2.66% at $181.70. Moving forward, investors will be keeping an eye on loan quality and underwriting activity, particularly as commercial real estate charge-offs totaled $105 million during the period and investment management revenues dropped 12% due to fund adjustments.

Key points

  • Morgan Stanley posted Q3 net revenues of $20.338 billion, up 11.6% year-over-year, while diluted earnings per share rose to $3.03.
  • Equity trading revenue jumped 41% to $5.799 billion, pushing Institutional Securities net revenue to $10.0 billion.
  • Wealth Management achieved record net revenues of $9.1 billion, drawing in $232 billion in net new assets during the quarter.
  • Provision for credit losses rose to $141 million, including $105 million in corporate and commercial real estate loan charge-offs.
  • Fixed-income net revenue decreased 7% to $2.011 billion, while Investment Management revenue fell 12% to $1.5 billion.

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Questions and answers

What were Morgan Stanley's Q3 revenue and earnings in 2026?

Morgan Stanley generated $20.338 billion in net revenues for the third quarter, an 11.6% increase from the prior year. Diluted earnings per share came in at $3.03, up from $2.80 in the same quarter a year earlier.

How did Morgan Stanley's trading and wealth management divisions perform?

Equity trading revenue rose 41% to $5.799 billion, while fixed-income revenue dropped 7% to $2.011 billion. Wealth Management achieved record net revenues of $9.1 billion, drawing in $232 billion in net new assets.

Why did Morgan Stanley increase its provision for credit losses in Q3?

The bank set aside $141 million for credit losses due to portfolio growth in corporate and secured lending. The quarter also saw $105 million in charge-offs tied to corporate and commercial real estate loans.