Charles Schwab NYSE: SCHW executives highlighted record first-quarter client growth, strong engagement amid market volatility, and expanding product capabilities—particularly in managed investing, lending, artificial intelligence, and digital assets—during the company’s 2026 Spring Business Update.
Record client growth and engagement in Q1
President and CEO Rick Wurster said Schwab’s “Through Clients’ Eyes” strategy helped drive “record client growth and financial results in the Q1,” with clients opening 1.3 million brokerage accounts, up 10% from the prior year.
Wurster reported Schwab attracted $158 billion in core net new assets (NNA) during the quarter, excluding a “one-time mutual fund clearing outflow,” bringing total client assets to $11.8 trillion. He noted March was Schwab’s second-highest month of NNA on record, behind only December 2021.
Client activity was also elevated. Wurster said Schwab supported a record 9.9 million daily average trades and pointed to “over 600 million trades,” 7.8 million service-center calls, and about 570 million digital logins—up roughly 12% year-over-year. He added that calls were answered in “less than 30 seconds on average,” while Client Promoter Scores in investor services rose nine points from last year, “nearing all-time highs.”
Financial results: revenue up 16%, EPS hits record
Chief Financial Officer Mike Verdeschi said Schwab posted record Q1 revenue of $6.5 billion, up 16% year-over-year, with “double-digit year-over-year growth across all major line items.” Adjusted EPS was a record $1.43, up 38% from Q1 2025, and the adjusted pre-tax profit margin was 51.4%.
Verdeschi attributed a 16% increase in net interest revenue to several factors, including “the reduction of higher cost borrowings at the banks,” higher client utilization of lending solutions, and interest in long-short strategies. Asset management and administration fees rose 15% to a record $1.8 billion, while trading revenue increased 20% year-over-year on the back of record engagement. Bank deposit account fees also rose 20% due to improved net yield as lower-yielding fixed-rate obligations matured and repriced higher.
Adjusted expenses rose 5% year-over-year, which Verdeschi said reflected seasonality, strong client activity, and continued investments in growth initiatives, new products, AI, and scale and efficiency efforts.
Balance sheet and capital: lending growth, buybacks, and cash seasonality
On the balance sheet, Verdeschi said demand for Schwab’s lending solutions remained strong. Total bank loan balances reached $61 billion, up 29% from Q1 2025 and 5% from year-end 2025. Client margin loan balances ended the quarter at nearly $127 billion, up 13% from year-end levels, which he tied partly to long-short strategies and higher trading-related margin balances despite a “pullback in activity during the month of March.”
Verdeschi said client cash followed typical seasonal trends early in the year, but increased volatility in the latter part of Q1 contributed to a more defensive client posture. He cited $25 billion of cash inflows in March, contributing to an $8 billion sequential increase in client transactional sweep cash. For Q2, he said Schwab still expected a typical April drawdown due to tax payments, affecting both sweep cash and “other liquid cash alternatives such as money market funds.”
On capital, Verdeschi said the firm’s Adjusted Tier-One Leverage Ratio ended the quarter at 6.8%, within Schwab’s 6.75%–7% objective range. He also cited a 19% increase in the common stock dividend and $2.4 billion in share repurchases during Q1.
Looking ahead, Verdeschi said Schwab’s performance and current expectations for rates and engagement put the company “tracking higher than the $5.70-$5.80 EPS range implied by the scenario” shared in January, which excluded the impact of buybacks and the Forge acquisition. Schwab plans to provide an updated 2026 financial scenario in July.
Product expansion: managed investing, crypto rollout, and private markets
Wurster emphasized broader platform growth, pointing to managed investing net flows up 46% to an all-time record. He said Schwab Wealth Advisory net flows reached a record $10 billion, up 90% year-over-year, and that about 30% of managed investing flows came from legacy Ameritrade clients.
Schwab is also preparing to launch a spot crypto offering. Wurster said the “Schwab Crypto” employee pilot is underway and a phased client rollout is expected to begin “in the coming weeks.” The initial offering will include Bitcoin and Ether, with pricing set at 75 basis points on the dollar value of each trade. He said Schwab plans to add additional cryptocurrencies and eventually enable transfer capabilities for deposits and withdrawals.
Wurster also tied the crypto buildout to longer-term infrastructure optionality, saying Schwab is “building our own books and records and our own custody capabilities,” which he described as a “prelude” to potentially supporting tokenization of securities if clients demand it.
In private markets, Wurster said Schwab completed its acquisition of Forge, positioning the firm to provide clients access to pre-IPO shares through direct private share purchases and single- and multi-company funds, with rollout “over time.” He also discussed a pipeline for Schwab’s Private Issuer Equity Services, which offers cap table management solutions for pre-IPO companies.
Separately, Wurster said Schwab launched a Teen Investor account for ages 13 to 17 and is continuing to hire financial consultants and wealth advisors while planning roughly a dozen new branches in 2026.
AI and monetization discussions: assistants, portfolio insights, and cash tools
Wurster described Schwab as “already an AI-enabled company,” outlining a roadmap that includes AI-driven client insights and service. He said Schwab will begin rolling out “Portfolio Insights,” an AI-enabled experience, starting next month, providing tailored information on portfolio performance, holdings-related news, and Schwab research. Over 2026, Schwab plans to expand these insights to topics including concentration risk and asset allocation.
He also said Schwab is launching a generative search capability on schwab.com, with the first iteration expected this year. Beginning in June, Schwab plans to release an “Investor AI Assistant” with chat and voice capabilities to address frequent service needs, initially answering general questions and testing select actions such as setting beneficiaries, with “strict guardrails” and handoffs to human agents.
Wurster and Verdeschi both addressed investor questions about cash sweep economics and competitive dynamics. Wurster said Schwab does not view changing client cash behavior as a “big risk,” emphasizing that clients have “intentionally allocated their cash” and that Schwab has worked to make cash movement easy. He added that agentic AI capabilities could evolve how clients perform tasks over time, and that if clients want Schwab to proactively manage cash as part of broader allocation, “that would be a fee-based solution.”
Verdeschi added that total cash levels run around 10% of client assets, with transactional cash at about 4%, or roughly $10,000 per account. He said clients are actively managing allocations and Schwab can deliver additional products as demand emerges.
Executives also discussed other revenue initiatives. Wurster said Schwab is negotiating with more than 400 asset managers on its platform regarding ETF monetization and expects to have an ETF monetization strategy “in place and live” by the end of the year, with economics framed as a percentage of ETF fees and potentially greater opportunity in higher-fee active ETFs.
Schwab also fielded questions on trading economics, noting that high activity in Q1 coincided with lower revenue per trade. Wurster said traders were taking “smaller positions” and holding them for less time due to lower conviction amid uncertainty, leading to more frequent but smaller trades. Verdeschi added that elevated volatility tended to skew activity toward equities rather than derivatives, and said future trends will depend on market conditions.
About Charles Schwab NYSE: SCHW
Charles Schwab Corporation NYSE: SCHW is a diversified financial services firm that provides brokerage, banking, wealth management and advisory services to individual investors, independent investment advisors and institutional clients. Its primary offerings include retail brokerage accounts, online trading platforms, Schwab-branded mutual funds and exchange-traded funds (ETFs), retirement plan services, custodial services for independent Registered Investment Advisors (RIAs), and banking products through Charles Schwab Bank.
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