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PNC FINANCIAL SERVICES GROUP, INC. (PNC)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 delivered record revenue ($5.915B) and PPNR ($2.454B), with EPS of $4.35, driven by 3% NII growth and 9% fee growth; efficiency improved to 59% and credit remained solid (net charge-offs 0.22%) .
  • EPS beat consensus by ~$0.30 (+7%); revenue topped S&P Global consensus by ~$0.10B (+2%), with broad-based fee strength and fixed-rate asset repricing more than offsetting a modest NIM mix headwind from outsized commercial deposit growth .
  • Capital build and returns continued: CET1 rose to 10.6% and PNC returned $1.0B via dividends and buybacks; Q4 repurchases guided to $300–$400M; common dividend $1.70 declared .
  • Management reiterated 2026 NIM >3% and “comfortable” >$1B NII growth vs 2025, while near-term (Q4) guidance points to stable-to-down revenue and lower deposit rates with three Fed cuts expected by late-Jan 2026 .
  • Strategic catalysts: announced $4.1B FirstBank acquisition to accelerate retail scale in CO/AZ and branch expansion plan (200+ by 2029) underpin medium-term growth narrative .

What Went Well and What Went Wrong

  • What Went Well

    • Record revenue and PPNR with positive operating leverage; “we delivered another great quarter” (CEO) .
    • Fee income +9% q/q, capital markets & advisory +35% q/q on stronger M&A/underwriting/syndication; asset management/brokerage +3% .
    • Credit quality strong: NCOs 0.22%, delinquencies –5% q/q, CRE provision tailwinds; allowance stable at $5.3B (1.61% of loans) .

  • What Went Wrong

    • NIM dipped 1bp to 2.79% due to outsized growth in commercial interest-bearing deposits, which raised mix costs despite being NII accretive .
    • Other noninterest income –$14M q/q, with negative Visa derivative adjustment (–$35M) partially offset by higher private equity revenue .
    • Noninterest expense +2% q/q (+4% y/y) with investment in technology/branches; CFO flagged Q4 expenses up vs prior expectation as fee outperformance carried costs .

Financial Results

MetricQ3 2024Q1 2025Q2 2025Q3 2025
Revenue ($USD Billions)$5.432 $5.452 $5.661 $5.915
Net Interest Income ($USD Billions)$3.410 $3.476 $3.555 $3.648
Noninterest Income ($USD Billions)$2.022 $1.976 $2.106 $2.267
Diluted EPS ($)$3.49 $3.51 $3.85 $4.35
Net Interest Margin (%)2.64 2.78 2.80 2.79
Efficiency (%)61 62 60 59

Segment earnings ($USD Millions)

Segment EarningsQ3 2024Q2 2025Q3 2025
Retail Banking$1,172 $1,359 $1,324
Corporate & Institutional Banking$1,197 $1,229 $1,459
Asset Management Group$96 $129 $117
Other$(975) $(1,090) $(1,092)
Net Income ex-NCI$1,490 $1,627 $1,808

Key KPIs

KPIQ3 2024Q2 2025Q3 2025
Average Loans ($B)$319.6 $322.8 $325.9
Average Deposits ($B)$422.1 $423.0 $431.8
Net Loan Charge-offs ($MM)$286 $198 $179
Provision for Credit Losses ($MM)$243 $254 $167
CET1 Ratio (%)10.3 10.5 10.6
TBV per Share ($)$96.98 $103.96 $107.84
AOCI ($B)$(5.1) $(4.7) $(4.1)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Interest Income (q/q)Q4 2025Not specifiedUp ~1.5% vs Q3 2025 Raised specificity
Total Revenue (q/q)Q4 2025Not specifiedStable to down ~1% New
Noninterest Expense (q/q)Q4 2025FY 2025 up ~1% (July) FY 2025 up ~1.5%; Q4 up vs plan Raised
Net Charge-offs ($MM)Q4 2025Not specified$200–$225 New
Share Repurchases ($MM)Q4 2025“Consistent with Q3 levels” ~$300–$400 Maintained/Specified
Deposit Rate PaidQ4 2025Not specifiedDecline expected (Fed cuts) New
NIM (run-rate)FY 2026>3% expected Reiterated >3% Maintained
NII Growth vs 2025FY 2026~$1B (consensus) “Comfortably” >$1B (ex-FirstBank) Raised confidence
CRE BalancesEarly 2026Decline continuing Inflection beginning next year; positive into 2026 Improved outlook

Dividends: Declared $1.70 per common share (paid Nov 5, 2025); SCB at 2.5% and repurchase capacity remains .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2 2025)Current Period (Q3 2025)Trend
NII TrajectoryRecord 2025 NII expected; fixed-rate repricing benefit 2026 NII “comfortably” >$1B above 2025 (ex-FirstBank) Strengthening
NIM Outlook2.78–2.80% with expansion path 2.79% (–1bp on deposit mix); NIM >3% expected in 2026 Improving medium-term
Deposits & MixDeposit growth stable; brokered decline; seasonal commercial down in Q2 +$9B avg deposits; commercial IB +7%; deposit rate paid to decline in Q4 Growing; mix headwind easing
Capital ReturnsBuybacks ~$300–$400M next quarter; dividend raised to $1.70 CET1 10.6%; Q4 buybacks $300–$400M; ~$1B returned in Q3 Sustained
CRE ExposureCRE balances declining; elevated provisions Provision down; CRE outlook improved; inflection early 2026 Improving
Regulatory/MRAsElevated compliance workload; tariffs risk NPR on MRAs could cut “hundreds” of FTE-equivalent burden; optimism on simplification Positive tailwind
NDFI/Private CreditNo issues flagged NDFI growth not driving results; portfolio focused on bankruptcy-remote securitizations and low-loss capital commitment lines Managed risk
Branch/FootprintOngoing expansion investments Plan for 200+ new branches by 2029; 25 opened in 2025; ability to accelerate Accelerating
Macro & TariffsSlower growth; tariff uncertainty Baseline: multiple Fed cuts through Jan 2026; GDP <2%; unemployment >4.5% mid-2026 Easing rates; macro cautious

Management Commentary

  • CEO: “We delivered another great quarter with better than expected financial results and steady client growth… Fee income grew 9% and expenses were well-controlled… The planned acquisition of FirstBank positions us for accelerated expansion in Colorado and Arizona” .
  • CFO: “We do still expect our NIM to continue to expand and hit the 3% and above sometime during 2026… fee income increased $175M or 9%… capital markets and advisory up $111M or 35%” .
  • CFO on deposits: “Outsized commercial interest-bearing deposit growth… affected our NIM because of the mix change… NIM is an outcome, not something that we manage to” .
  • CFO on guidance: “We expect average loans to be stable to up 1%. Net interest income to be up ~1.5%… total revenue stable to down 1%… Q4 net charge-offs $200–$225M” .
  • CEO on NII: “There’s absolutely nothing that has changed on our trajectory of forward NII growth. We will be comfortably above $1B… for 2026” .
  • CEO on regulation: NPR on MRAs could materially reduce process burden (“hundreds” of FTE equivalents), while maintaining risk monitoring rigor .

Q&A Highlights

  • Margin dynamics: NIM declined 1bp solely due to commercial IB deposit mix; NIM expected to expand and exceed 3% in 2026; deposit rates expected to decline in Q4 on Fed cuts .
  • Expense cadence: Full-year noninterest expense now +1.5% (vs +1% prior), tied to fee outperformance; Q4 expense uptick seasonally and from business activity .
  • Capital framework: Operating CET1 range 10–10.5% under review; potential to run closer to lower end as constraints evolve; CET1 including AOCI 9.7% .
  • CRE outlook: Runoff to inflect beginning next year; improved expectations, lower loss rates aiding provision .
  • NDFI risk: Portfolio skewed to investment-grade, bankruptcy-remote securitizations and diversified capital commitment lines; not a driver of Q3 growth .

Estimates Context

MetricQ1 2025Q2 2025Q3 2025
EPS – Actual vs Consensus Mean ($)$3.51 vs $3.38567* $3.85 vs $3.56448* $4.35 vs $4.04594*
EPS Surprise+$0.12 (+4%)+$0.29 (+8%)+$0.30 (+7%)
Revenue – Actual vs Consensus Mean ($B)$5.452 vs $5.482* $5.661 vs $5.603* $5.915 vs $5.813*
Revenue Surprise–$0.03 (–0.5%)+$0.06 (+1%)+$0.10 (+2%)

Values marked with * retrieved from S&P Global (GetEstimates).

Why: Beats were driven by fixed-rate asset repricing, deposit growth, and broad fee momentum (capital markets, asset management, card/cash), while Q3 other income absorbed a –$35M Visa derivative headwind; NIM mix headwind did not derail NII growth .

Key Takeaways for Investors

  • EPS and revenue beats alongside record PPNR and improved efficiency signal durable operating leverage; near-term guidance (Q4 revenue stable-to-down) reflects normalization after elevated Q3 fees .
  • Mix-driven NIM dip is transient; outsized commercial IB deposit growth is NII accretive; deposit rates should fall with expected Fed cuts, supporting Q4 margin trajectory .
  • Credit remains benign and improving; Q4 NCO guidance ($200–$225M) manageable given allowance levels and CRE tailwinds .
  • Capital returns remain a catalyst (Q4 buybacks $300–$400M; $1.70 dividend); CET1 at 10.6% affords flexibility amid evolving regulatory and rating agency constraints .
  • Medium-term thesis: 2026 NIM >3% and “comfortable” >$1B NII uplift on securities/hedge positioning and asset repricing; FirstBank acquisition accelerates retail scale in CO/AZ and branch expansion boosts national retail presence .
  • Watch items: Fee normalization in Q4 after strong capital markets/MSR hedging; Visa derivative volatility; CRE runoff path to expected early-2026 inflection .
  • Trading implications: Positive EPS beat and reiterated medium-term NII/NIM runway vs cautious near-term revenue tone; buyback range supports downside; any clarity on MRAs/regulatory simplification could be a multiple enhancer .

Additional Q3 2025 Materials

  • Dividend declaration: $1.70 common dividend (paid Nov 5, 2025) .
  • FirstBank acquisition announced (95 branches; $26.8B assets; $4.1B implied consideration; expected close early 2026) .
  • Prime rate changes and other corporate releases around the quarter .

Sources: Q3 2025 8-K and financial supplement ; Q3 2025 press release ; Q3 2025 earnings call transcript ; Q2/Q1 press releases for trend .