Helped by an uptick in investor activity, Charles Schwab (NASDAQ:SCHW) saw its profit soar 84% in the first-quarter on sharply higher sales, sending its shares higher in morning trade.
The San Francisco-based brokerage posted net income of $243 million, or 20 cents a share, compared with $6 million, or break-even earnings per share, in the same quarter last year.
Continue Reading Below
Earnings last year were impacted by high charges related to its Schwab YieldPlus Fund Revenue and its affinity credit card program. Revenue was up 23% to $1.2 billion from $978 million.
Analysts polled by Thomson Reuters had expected earnings, on average, of 19 cents a share on revenues of $1.18 billion.
“Our diversified revenue streams and ongoing expense discipline are helping to deliver improved financial performance even in flat short-tern interest rate environment,” chief financial officer Joe Martinetto said in a statement.
New brokerage account openings totaled 224,000, with net new assets coming in at $25.1 billion and total client assets reaching a record $1.65 trillion, up 10% from the year-earlier period.
Offsetting the improvement was a 29% year-over-year drop in net new accounts to 37,000, though year-over-year total accounts climbed 4% to 5.6 million.
Founder and chairman of the company, Charles Schwab, said the environment is improving but remains choppy.
“Investors are faced with navigating ongoing challenges,” he said, “including geopolitical turmoil, vacillating energy prices, and the aftermath of major natural disasters.”
Though Schwab noted the looming problems further highlights the importance of the company’s services.