Wells Fargo on Friday reported lower revenue and earnings in the third quarter than a year ago amid a sharp decline in net interest income.
Here’s how the bank fared relative to Wall Street estimates, based on LSEG’s survey of analysts:
- Earnings per share: $1.42 per share doesn’t compare to an estimate of $1.28 cents
- Revenue: $20.37 billion and expected $20.42 billion
The bank’s shares rose 3% in premarket trading after the results.
The San Francisco-based lender posted $11.69 billion in net interest income, a key measure of what a bank is doing on lending. The figure fell 11% from the same quarter last year, falling short of the FactSet estimate of $11.9 billion. Wells attributed the decline to higher financing costs as customers migrated to higher-yielding deposit products.
“As we continue to make strategic investments in many of our businesses and de-emphasize or sell others, our revenue profile is very different than it was five years ago,” said CEO Charles Scharf. “Our revenue sources are highly diversified and fee-based revenue grew 16% in the first nine months of the year, which net interest income was on the upside.”
Wells’ net income fell to $5.11 billion, or $1.42 per share, in the third quarter from $5.77 billion, or $1.48 per share, in the same quarter a year ago. Revenue fell to $20.37 billion from $20.86 a year ago.
The bank set aside $1.07 billion as a provision for loan losses, including a slight decrease in the allowance for loan losses.
Wells repurchased $3.5 billion of common stock in the third quarter, bringing its nine-month total to $15 billion, a 60% increase from a year ago.
The bank’s shares are up 17% in 2024, lagging the S&P 500.
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