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WELLS FARGO & COMPANY/MN (WFC)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered solid results: revenue $20.822B (+3% q/q, +1% y/y), diluted EPS $1.60 (+15% q/q, +20% y/y), net income $5.494B; efficiency ratio improved to 64% (from 69% in Q1) .
  • Notable items: a $253M gain ($0.06/share) from acquiring the remaining interest in the merchant services JV, and continued fee growth offsetting lower y/y NII; CET1 ratio was 11.1% and LCR 121% .
  • Guidance: 2025 NII now expected to be roughly in line with 2024’s $47.7B (lower than prior “+1–3%” outlook), while 2025 noninterest expense is unchanged at ~$54.2B; Board approved raising the Q3 dividend to $0.45 (+12.5%) .
  • Stock reaction catalysts: removal of the Fed asset cap (June), expected SCB drop to 2.5%, and stronger capital return (buybacks/dividend), alongside clearer articulation of balance sheet allocation toward Markets (fee revenue) .

What Went Well and What Went Wrong

What Went Well

  • Fee momentum and diversification: Noninterest income rose 5% q/q and 4% y/y, driven by advisory/brokerage fees, investment banking, and card/merchant processing after the JV consolidation; “All other” benefited from $253M gain .
  • Credit quality remained strong: NCO ratio fell to 0.44% (vs. 0.57% y/y), with consumer NCOs down q/q and CRE office losses easing; nonperforming assets declined 3% q/q .
  • Strategic milestones and capital return: Asset cap lift; Q2 buybacks of $3.0B and plan to increase Q3 dividend to $0.45; CEO: “We now have the opportunity to grow in ways we could not while the asset cap was in place…” .

What Went Wrong

  • Net interest income still down y/y: NII decreased 2% y/y due to lower rates and deposit mix, despite a sequential +2% recovery; average deposit cost was 1.52% .
  • Corporate & Investment Banking (CIB) revenue down: Total revenue fell 3% y/y and 8% q/q; Markets equities revenue declined y/y as the prior-year Visa B gain rolled off; CRE revenue fell q/q with lower servicing income .
  • Commercial Banking pressure: CB revenue down 6% y/y on lower NII (rates), with only modest q/q growth; efficiency ratio worsened y/y (52 vs. 48) .

Financial Results

Core financials and profitability

MetricQ4 2024Q1 2025Q2 2025
Total Revenue ($USD Billions)$20.378 $20.149 $20.822
Diluted EPS ($)$1.43 $1.39 $1.60
Efficiency Ratio (%)68 69 64
Net Interest Margin (TE) (%)2.70 2.67 2.68
Net Loan Charge-offs ($MM)$1,211 $1,009 $997
NCO Ratio (% of avg loans, annualized)0.53% 0.45% 0.44%
Provision for Credit Losses ($MM)$1,095 $932 $1,005
Average Loans ($USD Billions)$906.353 $908.182 $916.719
Average Deposits ($USD Billions)$1,353.836 $1,339.328 $1,331.651

Capital, liquidity, and credit KPIs

MetricQ4 2024Q1 2025Q2 2025
CET1 Ratio (Standardized) (%)11.1 11.1 11.1
LCR (%)125 125 121
TLAC Ratio (%)24.8 25.1 24.4
Period-end Loans ($USD Billions)$912.745 $913.842 $924.418
Period-end Deposits ($USD Billions)$1,371.804 $1,361.728 $1,340.703
Allowance for Credit Losses (Loans) ($MM)$14,636 $14,552 $14,568

Segment revenue and net income

Segment ($MM)Q4 2024 RevenueQ1 2025 RevenueQ2 2025 RevenueQ4 2024 Net IncomeQ1 2025 Net IncomeQ2 2025 Net Income
Consumer Banking & Lending8,980 8,913 9,228 1,602 1,689 1,863
Commercial Banking3,171 2,925 2,933 1,203 794 1,086
Corporate & Investment Banking4,613 5,064 4,673 1,580 1,941 1,737
Wealth & Investment Management3,958 3,874 3,898 508 392 480
Corporate104 (177) 559 186 78 328

Actuals vs. Wall Street consensus (SPGI, Primary EPS/Revenue)

MetricQ2 2024 ConsensusQ2 2024 ActualQ1 2025 ConsensusQ1 2025 ActualQ2 2025 ConsensusQ2 2025 Actual
Primary EPS ($)1.2777*1.3428*1.2189*1.2762*1.3976*1.54*
Revenue ($USD Billions)20.228*19.453*20.760*19.217*20.807*19.817*

Values retrieved from S&P Global.*

Note: Company-reported total revenue for Q2 2025 was $20.822B (vs. SPGI “actual” revenue measure above), and diluted EPS was $1.60 .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Interest Income (NII)FY 2025Approx. +1% to +3% vs FY2024; trending low end Roughly in line with FY2024 NII of $47.7B Lowered
Noninterest ExpenseFY 2025~$54.2B ~$54.2B Maintained
Common DividendQ3 2025$0.40 per share $0.45 per share (approved) Raised
Stress Capital Buffer (SCB)Effective Q4 20253.7% (revised from 3.8%) Expected 2.5% (2.6% if NPR finalized) Lowered

Earnings Call Themes & Trends

TopicQ4 2024 (Q-2)Q1 2025 (Q-1)Q2 2025 (Current)Trend
Asset cap/regulatory progressFocus on consent orders; efficiency, fee growth, capital returns Further closures; optimism on regulatory/supervisory environment Asset cap lifted; more flexibility to grow deposits/loans/Markets Positive regulatory inflection
NII outlook & balance sheet allocation2025 NII +1–3% vs 2024; stability 1H, ramp 2H Low end of range; volatility in rates/loan demand Now “roughly in line” with 2024; more balance sheet to Markets (fee vs NII mix) Mix shift to fees; lower NII trajectory
Capital return$20B 2024 buybacks; dividend raised $3.5B Q1 buybacks; strong CET1 $3B Q2 buybacks; dividend to $0.45; expected SCB 2.5% More capacity to return capital
Credit quality/CRE officeStable but lumpy office CRE; NCOs steady Office valuations stabilizing; allowances consistent Commercial NCOs up modestly; CRE office ACL 7.9%; nonaccruals down Gradual improvement
Consumer growth (Cards/Auto/Branches)Strong card new accounts/spend; branch refurbishments Continued card growth; Auto originations turning; digital/mobile growth Card fees +12% q/q; Auto originations +50% q/q; 4,135 branches Execution momentum
Markets & IBTrading consistent; Markets down y/y in Q4 Good activity in commodities/FX; DCM strength Markets -1% y/y (equities down); IB fees +8% y/y Mixed: FX/rates strong, equities soft

Management Commentary

  • CEO: “We now have the opportunity to grow in ways we could not while the asset cap was in place… We are a far stronger company today because of the work we’ve done” .
  • CFO: “We currently expect net interest income for 2025 to be roughly in line with full-year 2024… largest driver is dedicating more balance sheet to our Markets business… lower NII but offset in noninterest income” .
  • Strategy: Continue fee-based growth (advisory, IB, payments), optimize expenses, invest in technology and branches, and allocate balance sheet selectively to drive returns .

Q&A Highlights

  • NII path and Markets mix: Management explained the NII reduction vs prior guide as primarily due to more balance sheet allocated to Markets, with fees offsetting NII; sequential NII still expected to grow in Q3/Q4 .
  • Capital/buybacks/dividend: With SCB expected lower and asset cap removed, WFC has “more capacity” to repurchase shares and raised the dividend to $0.45; capital buffers will be reassessed after more Fed transparency .
  • Deposits and branch growth: Expect more aggressive deposit growth across consumer/corporate; reinstated incentive frameworks, increased marketing, and branch refurbishments to drive primary checking growth .
  • Rate sensitivity and tax: Still modestly asset-sensitive; tax rate can have quarter-specific items (e.g., CA attribution change), longer-term “high-teens” view .
  • Competition and loan yields: Middle market spreads tight amid bank competition; modest loan growth expected skewed to CIB (fund finance, asset-backed), with cautious posture in consumer .

Estimates Context

  • SPGI consensus vs outcomes (Primary EPS/Revenue): WFC beat SPGI Primary EPS in Q2 2025 ($1.54 vs. $1.40*), and SPGI recorded “actual” revenue of $19.82B vs. $20.81B consensus*. Note WFC’s company-reported total revenue was $20.822B and diluted EPS was $1.60 .
  • FY context: SPGI FY2025 EPS consensus 6.23*, revenue 84.00B*. With the updated NII guide (roughly flat vs 2024), sell-side models may adjust NII mix, fee forecasts (Markets), and tax/expense assumptions .

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Earnings quality improved: Fee growth (advisory, brokerage, IB, payments) and lower operating losses drove better efficiency (64%) despite NII y/y pressure; credit remains benign with NCOs at 0.44% .
  • Narrative shift to fee/Markets: Re-allocation of balance sheet to Markets reduces NII trajectory but grows noninterest income; monitor sustained FX/rates strength and equities recovery .
  • Capital optionality: Asset cap removal and SCB reduction expand capacity for deposit/loan growth and buybacks; Q3 dividend to $0.45 signals confidence; watch final SCB and capital framework updates .
  • Consumer momentum: Card and merchant processing uplift, Auto originations turning up, and branch/digital investments are supporting primary checking growth; watch delinquency trends and payment rates seasonality .
  • CRE office risk moderating: Nonaccruals and ACL coverage trends stabilizing; losses expected but “well within expectations”—remain vigilant on office valuations and migration dynamics .
  • Tactical trading implications: Near-term, positive catalysts include dividend raise and asset cap lift; medium-term thesis hinges on executing fee growth, maintaining credit quality, and delivering operating leverage while reallocating balance sheet to higher-return activities .
## Appendix: Additional Data Points

- Company-wide: ROE 12.8%, ROTCE 15.2%; diluted average shares 3,267.0MM **[72971_0000072971-25-000170_ex993-wellsfargo2q25pres.htm:0]** **[72971_0000072971-25-000170_wfc2qer07-15x25ex991xrelea.htm:1]**.  
- CBL: Revenue $9,228MM (+4% q/q, +2% y/y); net income $1,863MM; efficiency ratio 63; mobile active customers 32.1MM **[72971_0000072971-25-000170_wfc-20250715.htm:0]**.  
- CIB Loans: Period-end $290.6B; Markets trading-related assets $283.0B **[72971_0000072971-25-000170_wfc2qer07-15x25ex992xsuppl.htm:18]**.  
- Corporate: “All other” revenue uplift from merchant services JV gain; tax benefit impacted corporate segment **[72971_0000072971-25-000170_wfc2qer07-15x25ex991xrelea.htm:0]** **[72971_0000072971-25-000170_wfc2qer07-15x25ex992xsuppl.htm:20]**.

Citations: All figures above are sourced from Wells Fargo’s Q2 2025 Form 8-K, Q2 2025 Quarterly Supplement, press releases, and Q2/Q1/Q4 earnings call transcripts as cited. Values marked with an asterisk (*) are retrieved from S&P Global.