Morgan Stanley $MS reported record quarterly revenue and profit on Wednesday, driven by a 69% surge in equities trading revenue that far exceeded analyst expectations.
The bank posted net revenue of $21.35 billion for the second quarter ended June 30, up 27% from $16.8 billion a year earlier. Net income rose 58% to $5.58 billion, or $3.46 per diluted share, compared with $3.54 billion, or $2.13 per diluted share, in the same period last year.
Analysts surveyed by LSEG had expected earnings of $2.94 per share on revenue of $19.64 billion, according to CNBC. Analysts surveyed by StreetAccount had expected equities trading revenue of roughly $4.4 billion, according to CNBC. The business brought in $6.3 billion, a gap of about $1.9 billion.
Equities trading was the standout performer, with net revenues climbing to $6.3 billion from $3.72 billion a year ago, the company said. The division posted record results on strong performance across businesses and regions, with particular strength in Asia, driven by client engagement and favorable market conditions.
Investment banking also contributed to the quarter's results, with net revenues rising 58% to $2.44 billion. Advisory revenues rose on higher completed mergers and acquisitions, particularly in the Americas, while equity underwriting revenue climbed on higher IPOs, follow-on offerings, and convertibles. Fixed income underwriting also increased from a year ago.
Wealth Management posted record net revenues of $8.86 billion, up 14% from $7.76 billion a year ago, with a pre-tax margin of 30.5%. The division added $148.1 billion in net new assets during the quarter, more than double the $59.2 billion added a year earlier. Just over half of that increase reflected inflows related to IPOs of certain clients in its workplace channel, the company said. Total client assets across Wealth and Investment Management reached $10 trillion.
Investment Management reported net revenues of $1.65 billion, up 6% from a year ago, driven by higher average assets under management.
"Active markets and consistent execution across all three regions drove exceptional results," Morgan Stanley CEO Ted Pick said in a statement.
The board declared a quarterly dividend of $1.15 per share, an increase of 15 cents, payable on August 14, 2026. The board also reauthorized a share repurchase program of up to $20 billion, beginning in the third quarter of 2026.