Charles Schwab reported third-quarter revenue of $7.2 billion, up 17% year over year, and adjusted diluted earnings per share of $1.69, up 29%, as it advances initiatives from its 2026 investor day. Core net new assets were $190.4 billion (5.8% annualized), while bank loans grew 35% and pledged asset lines grew 59%. Client cash fell 10 basis points to 8.9% of assets, a level the analyst considers expected given higher short-term rates and strong equity markets. Schwab added about $5.5 billion in pricier short-term borrowing and long-term debt, lifting net interest margin only slightly to 3.04% and modestly diluting margins and returns. The analyst plans to lower the $124 fair value estimate by a low-single-digit percentage, citing a modest revenue miss and a prudent balance sheet move behind the tepid share reaction.
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