Morgan Stanley reported first-quarter 2026 net revenues of $20.58 billion, up 16% from $17.74 billion a year earlier, as net income applicable to the firm rose 29% to $5.57 billion from $4.32 billion. Diluted earnings per share increased to $3.43 from $2.60.
Pre-tax income climbed to $7.01 billion from $5.54 billion, while return on tangible common equity improved to 27.1% from 23.0%. Book value per share rose to $66.18 from $60.41, and tangible book value per share increased to $51.58 from $46.08.
The firm’s expense efficiency ratio improved to 65% from 68%. Total compensation expense increased to $8.54 billion from $7.52 billion, and non-compensation expenses rose to $4.93 billion from $4.54 billion. Provision for credit losses fell to $98 million from $135 million.
Institutional Securities posted net revenues of $10.72 billion, up 19% from $8.98 billion. Pre-tax income in the division increased to $4.25 billion from $3.28 billion. Within the unit, investment banking revenue rose 36% to $2.12 billion from $1.56 billion. Advisory revenue jumped to $978 million from $563 million, equity underwriting increased to $396 million from $319 million, and fixed income underwriting rose to $742 million from $677 million. Equity trading revenue climbed 25% to $5.15 billion from $4.13 billion, while fixed income revenue increased 29% to $3.36 billion from $2.60 billion.
Wealth Management generated record net revenues of $8.52 billion, up 16% from $7.33 billion. Pre-tax income rose to $2.59 billion from $2.08 billion, and the pre-tax margin was 30.4%. Fee-based client assets increased to $2.79 trillion from $2.35 trillion. Fee-based asset flows rose to $53.7 billion from $29.8 billion, and net new assets climbed to $118.4 billion from $93.8 billion. Loans in the unit increased to $186.3 billion from $162.5 billion.
Investment Management reported net revenues of $1.54 billion, down from $1.60 billion. Pre-tax income declined to $280 million from $323 million. Assets under management rose to $1.868 trillion from $1.647 trillion, while long-term net flows fell to $3.3 billion from $8.6 billion.
Morgan Stanley repurchased $1.75 billion of common stock during the quarter, up from $1.00 billion a year earlier. The firm ended the period with 1.580 billion shares outstanding, down from 1.607 billion. The quarterly dividend was set at $1.00 per share. The effective tax rate declined to 19.6% from 21.2%.
Capital ratios moved mixed: standardized CET1 was 15.1%, down from 15.3%; standardized tier 1 capital was 16.8%, down from 17.2%; advanced CET1 was 16.0%, up from 15.7%; advanced tier 1 capital was 17.9%, up from 17.7%. Tier 1 leverage was 6.1%, compared with 6.9%, and the supplementary leverage ratio was 5.0%, down from 5.6%. Following these announcements, the company's shares moved -1.46%, and are now trading at a price of $163.23. Check out the company's full 8-K submission here.
