Charles Schwab reported a 30% year-over-year increase in first-quarter net income Thursday, as heightened market volatility and record client trading activity fueled broad financial gains – including within its RIA custody and advisory services segment.
The brokerage posted net income of $2.48 billion for the quarter, up from $1.91 billion a year ago. On an adjusted basis, earnings per share came in at $1.43, edging past analyst estimates of $1.40 from FactSet. Revenue climbed 16% to a record $6.5 billion, in line with forecasts. Total client assets rose 19% to $11.8 trillion.
Daily average trades hit a record 9.9 million for the quarter – up 34% year over year – as clients responded to volatile markets. Trading revenue grew 20%, while net interest income rose 16%. Asset management and administration fees increased 15% to $1.8 billion, driven in part by greater client adoption of Schwab's wealth and asset management offerings.
Schwab CEO Rick Wurster linked the trading surge to a cautious investor mindset.
"Our traders are feeling more uncertain about geopolitics [and] about potentially the economy," he said on the earnings call Thursday, noting that Schwab's traders have been taking smaller positions and holding them for shorter periods. Even so, margin-loan balances grew 13% from the fourth quarter of 2025.
Schwab's broader client engagement metrics were also strong. Core net new assets totaled $140 billion for the quarter, up from $137.7 billion during the same period in 2025. New brokerage account openings reached 1.3 million, bringing total active brokerage accounts to 39.1 million. Net flows into Schwab's managed investing solutions grew 46% year over year, and bank loan balances rose 29% to $60.9 billion at the end of March.
On the RIA front, Wurster said the company is "continuing to enhance our digital experiences across RIA workflows like move money, account [opening] and account maintenance while also modernizing tools on our adviser platform. Taken together, these enhancements help RIAs get routine work done faster and with fewer errors."
Cash management within the RIA channel also featured prominently in the call. Chief Financial Officer Michael Verdeschi noted that cash levels across the platform are running at around 10% of client assets, with transactional cash allocated at approximately 4% – or about $10,000 per account. He said "independent RIAs continue to help their end clients manage their portfolio allocations, including cash to help meet their individual financial goals."
Julian Lopez, head of enterprise solutions at Schwab Advisor Services, recently told InvestmentNews that its Advisor ProDirect program is seeing healthy adoption among advisors already in the RIA space.
"We’re really excited to be serving not just prospects with this model, but also existing advisors,” Lopez said. “As we continue go forward, we see a healthy mix between the two to help us expand that offering."
Looking ahead, Schwab teased plans to launch spot crypto trading – including bitcoin and ether – within the next few weeks, possibly to defend its flanks against the growing number of traditional financial firms now offering digital-asset access to clients.
Asked about prediction markets, Wurster reiterated his previous objections to sports gambling, noting that prediction markets were "very low on the list" of priorities among clients.
"That said, I think at some point, we likely will have production markets," he said, pointing to moves by bourses like CBOE and Nasdaq to cover binary options on financial events. "That's something certainly we will take a hard look at and then will be quite straightforward for us to offer."
Over the coming months, the company said it will also roll out AI tools capable of analyzing client portfolios and responding to general financial questions.
Despite the strong results, Schwab's stock fell nearly 5% in midday trading Thursday. The decline came after the shares had gained ground earlier in the week following reports that regulators moved to eliminate a decades-old requirement for "pattern day traders" to maintain at least $25,000 in equity in their margin accounts – a rule change that could encourage broader retail market participation.
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