Charles Schwab reports Q3 EPS 65c, consensus 65c
Reports Q3 revenue $2.58B, consensus $2.58B. CEO Walt Bettinger said, "Schwab's unwavering focus on our 'Through Clients' Eyes' strategy and disciplined execution have helped us set new performance records again and again. Clients opened 369,000 brokerage accounts in the third quarter, bringing our year-to-date new accounts to 1.2 million - the highest nine-month total in our history. The company is growing through both our Retail channel and the registered investment advisors who custody on our platform. Households new to Retail rose 24% for the first nine months of 2018 compared to last year, with 53% of those new clients under the age of 40. Additionally, Advisor Services attracted 173 RIA teams to Schwab thus far in the year, a pace that beats all pre-2017 annual totals. Each of our two primary businesses helped propel total company core net new assets to $53.5 billion, a third quarter record. We've generated $172.5 billion in core net new assets year-to-date - also surpassing all full-year totals prior to 2017. Client trading activity provided further evidence of ongoing engagement during the summer months. Against a backdrop of relatively stable markets, daily average trades reached 683,000, consistent with the second quarter and a third quarter record. In addition, clients continued to seek help and guidance through us; assets receiving ongoing advice marked a new high of $1.85 trillion at September 30th, up 15%. Total client assets grew 12% year-over-year, ending the quarter at a record $3.56 trillion. The consistent application of our 'Virtuous Cycle' has enabled us to drive growth, scale, and efficiency as we capture more market share. Since 2008, we have increased brokerage accounts over 50% and tripled our client asset base, all while driving down our ratio of expenses to client assets by a third - a notable accomplishment for a U.S. investment services firm of our size, especially without any substantial acquisitions. And we are not letting up: the company has attracted at least two dollars in inflows for every dollar transferred to a competitor for six consecutive quarters and our third quarter core net new assets represented a 7% annualized organic growth rate, outpacing our 6% average over the past 10 years. This success with clients has enabled us to make ongoing investments to support our current and future growth. Schwab's 2018 investment priorities - Application Modernization, Business Process Transformation, and Digital Accelerator - should all help to improve our cost structure advantage versus others in our industry, along with our ability to attract and serve an increasing share of the $45 trillion in U.S. investable wealth. We believe we have never been better positioned to continue winning in the marketplace and extending our lead in a scalable and efficient way - a testament to our inexorable pursuit of sustained profitable growth through putting clients first."