Morgan Stanley Beats Q1 Profit Estimates on Record Equity Trading and Wealth Management Growth

Morgan Stanley Beats Q1 Profit Estimates on Record Equity Trading and Wealth Management Growth

Key Highlights:

• Q1 net income: $4.3 billion ($2.60 per share) vs. $3.4 billion ($2.02 per share) a year ago

• Analyst estimate: $2.20 per share (LSEG); actual beat expectations

• Total revenue: $17.7 billion, up from $15.1 billion YoY

• Record equity trading revenue: Up 45%, driven by prime brokerage, derivatives, and strong activity in Asia

• Wealth management and fixed income trading also contributed to gains

Morgan Stanley reported stronger-than-expected earnings for the first quarter, driven by record equity trading revenueand solid performance in wealth management. The bank posted a net income of $4.3 billion, or $2.60 per share, beating analyst expectations of $2.20 per share. This compares to $3.4 billion, or $2.02 per share, in the same period last year.

Total revenue climbed to $17.7 billion, up from $15.1 billion in Q1 2024.

Equity trading revenue surged 45% year-over-year, with gains across regions, particularly in Asia, and across business segments like prime brokerage and derivatives. The increase was driven by elevated market volatility and portfolio rebalancing, especially in technology and industrial sectors.

Fixed income trading revenue also grew as clients adjusted strategies amid growing macroeconomic uncertainty and stagflation concerns.

In investment banking, revenue rose 8%, supported by gains in advisory services and fixed income underwriting. However, equity underwriting declined as market volatility caused delays in planned offerings.

Chief Financial Officer Sharon Yeshaya noted that although companies are delaying deals due to uncertainty, they are not cancelling them. “We have the largest pipeline in years, but strategic activity is taking longer to materialize,” she said.

Despite these strong results, Morgan Stanley shares dipped 1.9% in premarket trading amid broader market volatility and lingering concerns over global economic stability.