Charles Schwab has announced its earnings for the second quarter of 2023, and they're considerably lower than last year's.
The financial services giant revealed on Tuesday that its net income for the quarter was $1.3 billion, down half a billion dollars from the second quarter of 2022. Net interest revenue sank to $2.3 billion, down from $2.5 billion in the same period last year.
In an otherwise upbeat
"While navigating significant near-term headwinds, we generated second quarter revenues of $4.7 billion, down 9% on a year-over-year basis," said Peter Crawford, Schwab's chief financial officer.
Crawford blamed the drop in revenue mostly on "the current rising rate cycle." Since March 2022, the Federal Reserve has raised interest rates 10 times, including twice last quarter. Meanwhile, Schwab CEO Walt Bettinger alluded to "softer investor sentiment" at the beginning of the spring.
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The news for Schwab was not all bad, however. Even as the firm's profits shrank, its brokerage business expanded. Over the course of the spring, Bettinger said Schwab attracted close to a million new brokerage accounts and finished the quarter serving $8.02 trillion in total client assets.
"Against an improving, yet still somewhat unsettled backdrop, clients increased their utilization of help and advice at Schwab during the quarter, reflecting investors' continued trust in us to support them on their journey towards a better financial future," Bettinger said.
Here's a closer look at how Schwab did last quarter:
