Charles Schwab reported earnings for the second quarter of 2023, a sharp drop from last year.
The financial services giant revealed on Tuesday that net income for the quarter was $1.3 billion, down $500 million from the second quarter of 2022. Net interest income fell to $2.3 billion, down from $2.5 billion a year earlier.
in an otherwise optimistic situation Press releaseSchwab executives acknowledged some of the difficulties the company faced between April and June.
“Despite significant near-term headwinds, our second quarter revenue of $4.7 billion was down 9% year-over-year,” said Peter Crawford, Charles Schwab’s chief financial officer.
Crawford largely blamed the “current cycle of rising interest rates” for the decline in revenue. The Fed has raised interest rates 10 times since March 2022, including two in the last quarter. Meanwhile, Schwab CEO Walt Bettinger cited “softening investor sentiment” in early spring.
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However, the news wasn’t all bad for Schwab. While the company’s profits have shrunk, its brokerage business has expanded. Throughout the spring, Charles Schwab attracted nearly 1 million new brokerage accounts, servicing $8.02 trillion in total client assets at the end of the quarter, Bettinger said.
“Amid an improving but still somewhat volatile backdrop, clients increased their use of Charles Schwab’s help and advice during the quarter, reflecting investors’ continued trust in us and our support,” Bettinger said. They are on their way to a better financial future.”
Here’s a detailed breakdown of Schwab’s performance last quarter: