MW People are actively managing their money more than ever, Charles Schwab says

By Tomi Kilgore

The discount broker's stock led the S&P 500's decliners as revenue rose to a quarterly record but came up shy of expectations

Charles Schwab's stock was leading the S&P 500's decliners. Revenue rose to a quarterly record amid record trading activity, but missed expectations.

Shares of Charles Schwab dropped Thursday after the discount brokerage giant reported first-quarter revenue that rose to a quarterly record, with a strong boost from trading - but fell short of Wall Street projections.

In the face of a volatile market environment, particularly at the end of the first quarter, Schwab $(SCHW)$ said 1.3 million new brokerage accounts were opened during the quarter, pushing total active brokerage accounts to 39.1 million. And the core net new assets of $79.7 billion in March were the second-highest monthly total ever.

In another sign of retail investors taking a more active role in managing their money, Schwab said trading revenue jumped 20% from a year ago to $1.09 billion, due to record engagement. Daily average trading volume surged 34% to a record 9.9 million. Engagement refers to clients actively moving money to boost returns, or to protect what they've made.

Chief Financial Officer Mike Verdeschi said on the postearnings call with analysts that at the start of the quarter, client cash was following seasonal trends. "However, as volatility increased during the back half of the quarter, clients took a slightly more defensive posture," Verdeschi said, according to a FactSet transcript.

Amid all the trading activity, revenue for the quarter to March 31 grew 16% from a year ago to $6.48 billion, but that was just shy of the average analyst estimate compiled by FactSet of $6.50 billion. That was the second straight top-line miss, following a seven-quarter streak of beats.

The stock slumped 4.5% in midmorning trading, enough to pace the S&P 500 index's SPX decliners and to turn it negative for the year. It was also headed for the biggest one-day, postearnings decline since it sank 10.2% on July 16, 2024.

Net income rose 33.5% to $2.4 billion, pushing net earnings per share to a record $1.37, above the FactSet consensus of $1.35.

What provided a nice boost to the bottom-line results was that Schwab said it spent $2.4 billion during the first quarter - Truist analyst David Smith said that was more than expected - to repurchase shares.

The shares outstanding used to calculate EPS were down 3.8% to 1.752 billion shares. Based on the prior year's share count, net income of $2.4 billion would result in EPS of $1.32.

Looking ahead, Verdeschi said that, given strong client engagement and the expected path of interest rates, full-year EPS is tracking higher than the previous guidance of $5.70 to $5.80. The current FactSet consensus for net EPS is $5.72.

Schwab's stock has now lost 4.1% in 2026, while the State Street Financial Select Sector SPDR ETF XLF has shed 4.8% and the S&P 500 has gained 2.6%.

-Tomi Kilgore

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April 16, 2026 10:30 ET (14:30 GMT)

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