Charles Schwab Posts Record $7.1B Q2 Revenue as Trading Volume Hits All-Time High (SCHW)

Charles Schwab (NYSE: SCHW) reported record second-quarter results on July 21, 2026, with net revenues of $7.1 billion rising 20.9% year-over-year and adjusted EPS of $1.62 beating the $1.58 Wall Street consensus. GAAP EPS came in at $1.54, up 42.6% from $1.08 in Q2 2025, as broad client engagement across trading, lending, and wealth management drove the firm's best quarterly performance on record. Shares fell -2.52% on Tuesday while the S&P 500 gained 0.83%.

Q2 2026 Results

• Revenue: $7.072 billion in net revenues, up 20.9% year-over-year from $5.851 billion in Q2 2025
• EPS: GAAP EPS of $1.54 and adjusted EPS of $1.62, compared to GAAP EPS of $1.08 and adjusted EPS of $1.14 in Q2 2025
• Net income: GAAP net income of $2.8 billion, up 31.7% year-over-year; adjusted net income of $2.9 billion, up 31.9%
• Pre-tax profit margin: GAAP pre-tax margin expanded 4.0 percentage points year-over-year to 51.9%; adjusted pre-tax margin reached 54.3%, up 4.2 percentage points
• Client assets: Total client assets grew 22% year-over-year to $13.08 trillion, with core net new assets of $119.8 billion, up 49% versus Q2 2025

What Drove the Results

Adjusted EPS of $1.62 beat the $1.58 consensus by 2.5%, and GAAP EPS of $1.54 reflected $170 million in pre-tax transaction-related costs as the primary gap between the two measures. Trading revenue reached $1.2 billion, up 28% year-over-year, as daily average trading volume hit a record 11.9 million trades, a 57% increase versus Q2 2025. Asset management and administration fees grew 16% year-over-year to $1.8 billion, and the net interest margin expanded 12 basis points quarter-over-quarter to 3.00%.

Client transactional sweep cash balances ended June at $485.7 billion, up $24.2 billion from the prior quarter-end. Margin loan balances increased 30% quarter-over-quarter to $165.1 billion, and Pledged Asset Line balances reached $33.4 billion, up 59% from Q2 2025. Bank loan balances grew 33% year-over-year to $67.0 billion at June month-end, reflecting broad lending demand across the client base.

The quarter also saw the launch of Schwab Crypto, giving retail clients direct access to Bitcoin and Ethereum trading, and the introduction of Portfolio Insights, a generative AI-powered feature providing personalized portfolio performance analysis. Schwab opened 1.4 million new brokerage accounts in the quarter, bringing total client accounts to 48.0 million. June core net new assets alone totaled a record $62.7 billion, representing an annualized organic growth rate of 5.8%.

Managed Investing Solutions net flows grew 53% versus Q2 2025, while net flows into Schwab Wealth Advisory increased 80% year-over-year. Long/short strategy interest among RIA clients remained notable, with margin loan debits and short cash credits equaling $42.1 billion and $43.7 billion, respectively, as of June 30, 2026. During the quarter, Schwab also redeemed $2.1 billion in Series I Preferred Stock, issued $1.5 billion in Series L Preferred Stock, and repurchased 11.2 million shares of common stock for $1.0 billion.

Wall Street View

Wall Street's analyst community was broadly constructive on Schwab heading into the report, and the second-quarter results reinforced several key thesis points, including trading activity leverage and net interest margin recovery. The consensus estimate of $1.58 adjusted EPS was beaten, and the company's guidance update, which included a boosted revenue outlook per market coverage, provides incremental support for forward estimates.

Investor Takeaway

The record quarterly results reflect the operating leverage in Schwab's model as client engagement across every major revenue line accelerated simultaneously. With the net interest margin now at 3.00% and expanding, and organic growth running at a 5.8% annualized rate, the structural revenue recovery investors have awaited appears materially underway. The simultaneous launch of Schwab Crypto and the AI-powered Portfolio Insights tool signals the firm is investing in next-generation client acquisition at a moment of financial strength, a combination that may sustain account growth momentum beyond the current volatile-market trading cycle.