Charles Schwab Corporation (The) (SCHW)

Item 1. Business

General Corporate Overview

The Charles Schwab Corporation (CSC) is a savings and loan holding company. CSC engages, through its subsidiaries (collectively referred to as Schwab or the Company), in wealth management, securities brokerage, banking, asset management, custody, and financial advisory services. At December 31, 2025, Schwab had $11.90 trillion in client assets, 38.5 million active brokerage accounts, 5.7 million workplace plan participant accounts, and 2.2 million banking accounts.

Principal business subsidiaries of CSC include the following:

•Charles Schwab & Co., Inc. (CS&Co), incorporated in 1971, a securities broker-dealer;

•Charles Schwab Bank, SSB (CSB), our principal banking entity; and

•Charles Schwab Investment Management, Inc. (CSIM), the investment advisor for Schwab’s proprietary mutual funds (Schwab Funds®) and for Schwab’s exchange-traded funds (Schwab ETFs).

Unless otherwise indicated, the terms “Schwab,” “the Company,” “we,” “us,” or “our” mean CSC together with its consolidated subsidiaries.

Schwab provides financial services to individuals and institutional clients through two segments – Investor Services and Advisor Services. The Investor Services segment provides retail brokerage, investment advisory, and banking and trust services to individual investors, and retirement plan and business services, as well as other corporate brokerage services, to businesses and their employees. The Advisor Services segment provides custodial, trading, banking and trust, and support services to independent registered investment advisors (RIAs), independent retirement advisors, and recordkeepers. These services are further described in the segment discussion below.

Business Strategy and Competitive Environment

Schwab was founded on the belief that all Americans deserve access to a better investing experience. Although much has changed in the intervening years, our purpose remains clear – to champion every client’s goals with passion and integrity. Guided by this purpose and our vision of creating the most trusted leader in investment services, management has adopted a strategy described as “Through Clients’ Eyes.”

This strategy emphasizes placing clients’ perspectives, needs, and desires at the forefront. Because investing plays a fundamental role in building financial security, we strive to deliver a better investing experience for our clients – individual investors and the people and institutions who serve them – by disrupting longstanding industry practices on their behalf and providing superior service. We also aim to offer a broad range of products and solutions to meet client needs with a focus on transparency, value, and trust. In addition, management works to couple Schwab’s scale and resources with ongoing expense discipline to keep costs low and ensure that products and solutions are affordable as well as responsive to client needs. In combination, these are the key elements of our “no trade-offs” approach to serving investors. We believe that following this strategy is the best way to maximize our market valuation and stockholder returns over time.

Management estimates that investable wealth in the United States (U.S.) (consisting of assets in defined contribution, retail wealth management and brokerage, and registered investment advisor channels, along with bank deposits) currently exceeds $80 trillion, which means the Company’s $11.90 trillion in client assets leaves substantial opportunity for growth. Our strategy is based on the principle that developing trusted relationships will translate into more assets from both new and existing clients, ultimately driving more revenue, and along with expense discipline and thoughtful capital management, will generate earnings growth and build long-term stockholder value.

Within Investor Services, our competition in serving individual investors spans brokerage, wealth management, and asset management firms, as well as banks, trust companies, financial technology (fintech) companies, and retirement service providers. In the Advisor Services arena, we compete with institutional custodians, wirehouses, regional and independent broker-dealers, fintech custodians, banks, and trust companies.

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THE CHARLES SCHWAB CORPORATION

Across both segments, our key competitive advantages are:

•Scale and Size of the Business – As one of the largest investment services firms in the U.S., we are able to spread operating costs and amortize new investments over a large base of clients, and harness the resources to evolve capabilities to meet client needs.

•Operating Efficiency – Coupled with scale, our operating efficiency and sharing of infrastructure across different businesses creates a cost advantage that enables us to competitively price products and services while profitably serving clients of various sizes across multiple channels.

•Operating Structure – Providing bank, wealth, and asset management services to broker-dealer clients helps serve a wider array of needs, thereby deepening relationships, enhancing the stability of client assets, and enabling diversified revenue streams.

•Brand and Corporate Reputation – In an industry dependent on trust, Schwab’s reputation and brand across multiple constituents enable us to attract clients and employees while credibly introducing new products to the market.

•Service Culture – Delivering a great client experience earns the trust and loyalty of clients and increases the likelihood that those clients will refer others.

•Willingness to Disrupt – Management’s willingness to challenge the status quo, including our own business practices, to benefit clients fosters innovation and continuous improvement, which helps to attract more clients and assets.

Business Acquisition

Forge Global Holdings, Inc.

On November 6, 2025, Schwab announced that it had entered into a definitive agreement to acquire Forge Global Holdings, Inc. (Forge), operator of a leading private market platform and trading marketplace, in a transaction valued at approximately $660 million. The Company anticipates that incorporating Forge’s private company investment capabilities will enhance Schwab’s ability to meet the evolving needs of investors across our growing client base. The transaction was approved by Forge’s stockholders in January 2026, and is expected to close in March 2026, subject to customary closing conditions, including regulatory approvals.

Products and Services

Schwab offers a broad range of products and services through intuitive end-to-end solutions, including robust digital capabilities, to address our clients’ varying investment and financial needs. Examples of these offerings include the following:

•Brokerage – an array of full-feature brokerage accounts with equity and fixed income trading, margin lending, options trading, futures and forex trading, and cash management capabilities including money market funds and certificates of deposit (CDs);

•Mutual funds – third-party mutual funds through the Mutual Fund Marketplace®, including no-transaction-fee (NTF) mutual funds through the Mutual Fund OneSource® and Institutional No-Transaction-Fee services, as well as mutual fund trading and clearing services to broker-dealers;

•Exchange-traded funds (ETFs) – an extensive offering of ETFs, including both proprietary and third-party ETFs;

•Managed investing solutions – managed portfolios of both proprietary and third-party mutual funds and ETFs, separately managed accounts, customized personal advice for tailored portfolios, specialized planning, and portfolio management;

•Alternative investments – access to a variety of third-party alternative investments, such as private equity and real estate on Schwab’s alternative investment platforms, including Schwab Alternative Investment OneSource® and Alternative Investment Select;

•Digital assets – cryptocurrency exchange-trade products (ETPs), options on select cryptocurrency ETPs, cryptocurrency futures, with expanded access to select cryptocurrencies expected to be offered to clients beginning in 2026;

•Banking – checking and savings accounts, first lien residential real estate mortgage loans (First Mortgages), home equity lines of credit (HELOCs), and pledged asset lines (PALs); and

•Trust – trust custody services, personal trust reporting services, and administrative trustee services.

These investing products and services are made available through two business segments – Investor Services and Advisor Services. Schwab’s major sources of revenues are generated by both of the reportable segments, based on their respective levels of client assets and activity. Revenue is attributable to a reportable segment based on which segment has the primary responsibility for serving the client. The accounting policies of the reportable segments are the same as those described in Part II – Item 8 – Note 2.

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THE CHARLES SCHWAB CORPORATION

Investor Services

Charles Schwab initially founded the Company nearly 55 years ago to provide individual investors with access to the financial markets at a highly competitive cost. The Company has expanded offerings over time in response to client needs, aiming to provide a compelling and often disruptive solution in the marketplace. The Investor Services segment includes the following business units: Retail Investor; Workplace Services (formerly Workplace Financial Services), which includes Retirement Plan Services, Retirement Business Services, Stock Plan Services, and Designated Brokerage Services; Mutual Fund Clearing Services; and Off-Platform Sales.

Through the Retail Investor business unit, Schwab serves a broad spectrum of individual investors, ranging from those just beginning their investing journey to clients with substantial and complex wealth management needs. We support newer investors with accessible products such as Schwab Stock Slices® and the Schwab Starter Kit®, alongside a comprehensive set of trading capabilities, advisory solutions, and educational resources. Our multichannel service model delivers award-winning, 24/7 support via online, mobile, telephone, and branch channels, ensuring clients receive consistent service regardless of asset level or preferred method of engagement.

Schwab offers several relationship models designed to meet differing levels of financial complexity, engagement, and service preference. Financial Consultants, Active Trader Financial Consultants, and Wealth Consultants provide guidance, relationship management, and specialized support across areas such as financial planning, managed investing, trading, trust services, equity compensation, and lending. For clients with more substantial needs, Schwab Private Client Services™ (for clients with $1 million to $10 million in qualifying assets) and Schwab Private Wealth Services™ (for clients with more than $10 million) provide enhanced, relationship-based experiences including dedicated service teams, specialized expertise, expedited processing, pricing advantages, and access to exclusive product offerings.

Schwab offers a comprehensive suite of advisory solutions, including both discretionary and non-discretionary services, with minimum investments starting at $5,000. Our flagship program, Schwab Wealth Advisory™, provides a dedicated Wealth Advisor supported by a team of professionals offering financial planning, specialized support, and customized portfolio management. We also provide referrals to independent registered investment advisors through the Schwab Advisor Network® and offer a broad selection of proprietary, and third-party managed solutions to meet diverse client needs.

For self-directed clients, Schwab provides robust digital and software based trading platforms, real-time market data, research tools, and multichannel support. Eligible clients can trade equities, mutual funds, ETFs, fixed income, options, futures, and forex. Schwab Trading Powered by Ameritrade® offers access to the thinkorswim® suite, along with specialized education and 24/7 support. Schwab also offers international investing capabilities, including access to U.S. markets for non U.S. clients, multicurrency trading for U.S.-based investors, and trading in foreign securities.

Educational resources include articles, videos, podcasts, interactive courses, live events, and tools such as Schwab Equity Ratings®. We also provide in-depth market analysis through the Schwab Network and publish the Schwab Trading Activity Index™, which offers insights into retail trading behavior and sentiment.

Together, these solutions provide a single, integrated platform that enables clients to engage with Schwab in a way that best aligns with their investing style, financial goals, and preferences.

Workplace Services includes Retirement Plan Services, Retirement Business Services, Stock Plan Services, and Designated Brokerage Services. Retirement Plan Services offers a range of bundled retirement plan product types that provides retirement plan sponsors with extensive investment options, trustee or custodial services, and plan participant-level recordkeeping. Retirement plan design features, which increase plan efficiency and achieve plan sponsor goals, are also offered, including automatic enrollment, automatic fund mapping at conversion, and automatic contribution increases. In addition to an open architecture investment platform, we offer a managed investing service to help plan participants work toward their retirement goals. Individuals investing for retirement through 401(k) plans can take advantage of bundled offerings of multiple investment choices, education, third-party advice, and an integrated brokerage window.

Retirement Business Services provides trust, custody, and software services to independent retirement plan advisors and independent recordkeepers. Retirement Business Services also offers the Schwab Personal Choice Retirement Account®, a self-directed brokerage offering for retirement plans. The Company and independent retirement plan providers work together to serve plan sponsors, combining the consulting and administrative expertise of the administrator with our investment, technology, brokerage, trust, and custodial services.

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THE CHARLES SCHWAB CORPORATION

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Financial statements

data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .

From 10-Q filed 2026-08-07 (period ending 2026-06-30).

Part I – FINANCIAL INFORMATION

THE CHARLES SCHWAB CORPORATION

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Tabular Amounts in Millions, Except Ratios, or as Noted)

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

INTRODUCTION

Principal business subsidiaries of CSC include the following:

•Charles Schwab & Co., Inc. (CS&Co), incorporated in 1971, a securities broker-dealer;

•Charles Schwab Bank, SSB (CSB), our principal banking entity; and

•Charles Schwab Investment Management, Inc. (CSIM), the investment advisor for Schwab’s proprietary mutual funds (Schwab Funds®) and for Schwab’s exchange-traded funds (Schwab ETFs).

Unless otherwise indicated, the terms “Schwab,” “the Company,” “we,” “us,” or “our” mean CSC together with its consolidated subsidiaries.

Management estimates that investable wealth in the United States (U.S.) (consisting of assets in defined contribution, retail wealth management and brokerage, and RIA channels, along with bank deposits) currently exceeds $90 trillion, which means the Company’s $13.08 trillion in client assets leaves substantial opportunity for growth. Our strategy is based on the principle that developing trusted relationships will translate into more assets from both new and existing clients, ultimately driving more revenue, and along with expense discipline and thoughtful capital management, will generate earnings growth and build long-term stockholder value.

This Management’s Discussion and Analysis should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (2025 Form 10-K).

On our website, https://www.aboutschwab.com, we post the following filings after they are electronically filed with or furnished to the Securities and Exchange Commission (SEC or Commission): annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934. In addition, we post to the website the Dodd-Frank stress test results, our regulatory capital disclosures based on Basel III, our average liquidity coverage ratio (LCR), and our average net stable funding ratio (NSFR). The SEC maintains a website at https://www.sec.gov that contains reports, proxy statements, and other information that we file electronically with the Commission.

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THE CHARLES SCHWAB CORPORATION

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Tabular Amounts in Millions, Except Ratios, or as Noted)

FORWARD-LOOKING STATEMENTS

In addition to historical information, this Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are identified by words such as “believe,” “anticipate,” “expect,” “intend,” “plan,” “will,” “may,” “estimate,” “appear,” “could,” “would,” “aim,” “maintain,” “continue,” “seek,” and other similar expressions. In addition, any statements that refer to expectations, strategy, objectives, projections, or other characterizations of future events or circumstances are forward-looking statements.

These forward-looking statements, which reflect management’s expectations and objectives as of the date hereof, are based on the best judgment of Schwab’s senior management. These statements relate to, among other things:

•Maximizing our market valuation and stockholder returns over time; and our belief that developing trusted relationships will translate into more client assets which drives revenue and, along with expense discipline and thoughtful capital management, generates earnings growth and builds stockholder value (see Introduction in Part I – Item 2);

•Industry and competitive trends including artificial intelligence, digital assets, private company securities and other alternative investments;

•The Company’s spot crypto trading offer (see Overview in Part I – Item 2);

•The integration of Forge Global Holdings, Inc. and its private market capabilities (see Overview in Part I – Item 2);

•Estimates of market opportunity (see Introduction in Part I – Item 2);

•Growth of our client base and our business, strong client engagement, sustained demand for the Company’s offerings and solutions, and strategic initiatives (see Overview in Part I – Item 2);

•Capital expenditures and expense management (see Results of Operations in Part I – Item 2);

•SEC transaction fee increases (see Results of Operations in Part I – Item 2);

•Net interest revenue, client cash allocation, and adjustment of rates paid on client-related liabilities (see Results of Operations in Part I – Item 2);

•Wholesale funding and funding strategy (see Results of Operations in Part I – Item 2, and Liquidity Risk in Part I – Item 2);

•Management of interest rate risk; modeling and assumptions, the impact of changes in interest rates on net interest margin and revenue, bank deposit account fee revenue, economic value of equity (EVE), and liability and asset duration (see Risk Management in Part I – Item 2);

•Sources and uses of liquidity (see Liquidity Risk in Part I – Item 2);

•Capital management; long-term operating objective; and uses of capital and return of excess capital to stockholders (see Capital Management in Part I – Item 2);

•The expected impact of proposed and final rules (see Current Regulatory and Other Developments in Part I – Item 2);

•The likelihood of indemnification and guarantee payment obligations and clients failing to fulfill contractual obligations (see Commitments and Contingencies in Part I – Item 1 – Financial Information – Notes to Condensed Consolidated Financial Statements (Item 1) – Note 11, and Financial Instruments Subject to Off-Balance Sheet Credit Risk in Item 1 – Note 13); and

•The outcome and impact of legal proceedings and regulatory matters (see Legal Proceedings in Part II – Item 1, and Commitments and Contingencies in Item 1 – Note 11).

Achievement of these expectations and objectives is subject to certain risks and uncertainties that could cause actual results to differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q or, in the case of documents incorporated by reference, as of the date of those documents.

Important factors that may cause actual results to differ include, but are not limited to:

•General economic and market conditions, including the level of interest rates, equity market valuations and volatility;

•The impact of new and emerging technologies;

•Our ability to attract and retain clients, develop trusted relationships, and grow client assets;

•Client use of our advisory and lending solutions and other products and services;

•The level of client assets, including cash balances;

•Client cash allocations and sensitivity to deposit rates;

•Competitive pressure on pricing, including deposit rates;

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THE CHARLES SCHWAB CORPORATION

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Tabular Amounts in Millions, Except Ratios, or as Noted)

•The level and mix of client trading activity, including daily average trades (DATs), margin balances, and balance sheet cash;

•Regulatory guidance and adverse impacts from new or changed legislation, rulemaking or regulatory expectations;

•Capital and liquidity needs and management;

•Our ability to manage expenses;

•Our ability to attract and retain talent;

•Our ability to develop and launch new and enhanced products, services, and capabilities, as well as enhance our infrastructure, in a timely and successful manner;

•Our ability to support client activity levels;

•Increased compensation and other costs;

•Real estate and workforce decisions;

•The timing and scope of technology projects;

•Balance sheet positioning relative to changes in interest rates;

•Interest-earning asset mix and growth;

•Our ability to access funding sources and the cost of funding;

•Prepayment levels for mortgage-backed securities;

•Regulatory and legislative developments;

•Adverse developments in litigation or regulatory matters and any related charges; and

•Potential breaches of contractual terms for which we have indemnification and guarantee obligations.

Certain of these factors, as well as general risk factors affecting the Company, are discussed in greater detail in Part I – Item 1A – Risk Factors in the 2025 Form 10-K.

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THE CHARLES SCHWAB CORPORATION

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Tabular Amounts in Millions, Except Ratios, or as Noted)

OVERVIEW

Management focuses on several client activity and financial metrics in evaluating Schwab’s financial position and operating performance. Results for the second quarter and first six months of 2026 and 2025 are as follows:

	Three Months Ended June 30,						Percent Change		Six Months Ended June 30,						Percent Change
	2026			2025					2026			2025
Client Metrics
Net new client assets (in billions) (1)	$	118.7		$	73.6		61	%	$	258.6		$	206.0		26	%
Core net new client assets (in billions)	$	119.8		$	80.3		49	%	$	259.8		$	218.0		19	%
Client assets (in billions, at quarter end)	$	13,084.9		$	10,757.3		22	%
Average client assets (in billions)	$	12,723.5		$	10,108.5		26	%	$	12,386.9		$	10,160.3		22	%
New brokerage accounts (in thousands)	1,388			1,098			26	%	2,687			2,281			18	%
Active brokerage accounts (in thousands, at quarter end)	39,802			37,476			6	%
Assets receiving ongoing advisory services (in billions, at quarter end)	$	6,671.7		$	5,425.0		23	%
Client cash as a percentage of client assets (at quarter end)	9.0		%	9.9		%
Company Financial Information and Metrics
Total net revenues	$	7,072		$	5,851		21	%	$	13,554		$	11,450		18	%
Total expenses excluding interest	3,403			3,048			12	%	6,697			6,192			8	%
Income before taxes on income	3,669			2,803			31	%	6,857			5,258			30	%
Taxes on income	869			677			28	%	1,578			1,223			29	%
Net income	2,800			2,126			32	%	5,279			4,035			31	%
Preferred stock dividends and other	119			149			(20)	%	201			262			(23)	%
Net income available to common stockholders	$	2,681		$	1,977		36	%	$	5,078		$	3,773		35	%
Earnings per common share (EPS) — diluted	$	1.54		$	1.08		43	%	$	2.91		$	2.07		41	%
Net revenue change from prior year	21		%	25		%			18		%	21		%
Pre-tax profit margin	51.9		%	47.9		%			50.6		%	45.9		%
Return on average common stockholders’ equity (annualized)	25		%	19		%			23		%	18		%
Expenses excluding interest as a percentage of average client assets (annualized)	0.11		%	0.12		%			0.11		%	0.12		%
Consolidated Tier 1 Leverage Ratio (at quarter end)	8.7		%	9.8		%
Non-GAAP Financial Measures (2)
Adjusted total expenses	$	3,233		$	2,920				$	6,384		$	5,934
Adjusted diluted EPS	$	1.62		$	1.14				$	3.05		$	2.17
Return on tangible common equity (annualized)	44		%	35		%			41		%	34		%
Adjusted Tier 1 Leverage Ratio (consolidated)	6.8		%	7.2		%

(1) The second quarter and first six months of 2026 include net outflows of $1.1 billion and $1.2 billion, respectively, from off-platform brokered certificates of deposit (CDs) issued by CSB. The second quarter and first six months of 2025 include net outflows of $6.7 billion and $12.0 billion, respectively, from off-platform brokered CDs issued by CSB.

(2) See Non-GAAP Financial Measures for further details and a reconciliation of such measures to GAAP reported results.

The second quarter and first six months of 2026 was a changing but generally positive macroeconomic environment for clients. While equity markets declined amid elevated volatility in the first quarter of 2026, market returns rebounded strongly positive and volatility eased in the second quarter, as the Standard and Poor’s® 500 Index and NASDAQ Composite® rose 15% and 21%, respectively, in the second quarter, finishing the first half of the year up 10% and 13%, respectively. The Federal Reserve kept the target federal funds overnight rate unchanged throughout the first six months of 2026, while the 10-year U.S. Treasury yield rose 25 basis points to 4.44% at June 30.

Supported by equity market growth and strong asset gathering, total client assets increased to $13.08 trillion at June 30, up 10% from year-end 2025. Schwab attracted core net new assets of $119.8 billion in the second quarter of 2026, up 49% from the same period in 2025, bringing the total for the first half of the year to $259.8 billion, up 19% from the first half of 2025. New brokerage accounts were 1.4 million and 2.7 million in the second quarter and first half of 2026, respectively, up 26% and 18% from the same prior-year periods, and active brokerage accounts reached 39.8 million at June 30, 2026, up 6% year-over-year. Clients continued to be highly engaged in the markets throughout the first half of 2026, with DATs reaching 11.9 million and 10.9 million in the second quarter and first six months of 2026, respectively, higher by 57% and 46% from the respective 2025 periods.

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THE CHARLES SCHWAB CORPORATION

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Tabular Amounts in Millions, Except Ratios, or as Noted)

Schwab’s financial results for the second quarter and first six months of 2026 reflected the growth of our client base, strong client engagement, and sustained demand for Schwab’s lending offerings and managed investing solutions. Net income increased to $2.8 billion and $5.3 billion in the second quarter and first six months of 2026, respectively, higher by 32% and 31% from the same periods in 2025. Diluted EPS was $1.54 and $2.91 in the second quarter and first six months of 2026, respectively, rising year-over-year 43% and 41%, respectively. Adjusted diluted EPS (1) was $1.62 and $3.05 in the second quarter and first six months of 2026, respectively, up 42% and 41% from the same prior-year periods.

Total net revenues were $7.1 billion and $13.6 billion in the second quarter and first six months of 2026, respectively, growing 21% and 18% from the same periods in 2025. Net interest revenue was $3.4 billion and $6.5 billion in the second quarter and first six months of the year, respectively, higher by 19% and 18% from the same periods in 2025, reflecting growth in margin and bank lending solutions and lower average wholesale borrowings, partially offset by lower yields on floating-rate assets, lower available for sale (AFS) and held to maturity (HTM) securities, and lower segregated cash and investments. Asset management and administration fees totaled $1.8 billion and $3.6 billion in the second quarter and first six months of 2026, respectively, increasing 16% from both comparable periods in 2025, due primarily to higher average client assets driven by asset gathering, market appreciation, and growth in managed investing solutions. Trading revenue was $1.2 billion and $2.3 billion in the second quarter and first half of 2026, respectively, increasing 28% and 24% from the comparable periods in 2025, reflecting higher order flow revenue and commissions due to higher trading volume and mix of trading activity. Bank deposit account fee revenue was $333 million and $628 million in the second quarter and first six months of 2026, respectively, increasing 35% and 28% from the same periods in 2025, due primarily to higher net yields, partially offset by lower average bank deposit account balances (BDA balances).

Total expenses excluding interest were $3.4 billion and $6.7 billion in the second quarter and first six months of 2026, respectively, up 12% and 8% from the same prior-year periods. For the second quarter and first six months of 2026, adjusted total expenses (1) were $3.2 billion and $6.4 billion, respectively, increasing 11% and 8% from the comparable periods in 2025. These increases in expenses were driven by strong client engagement and the inclusion of Forge Global Holdings, Inc. (Forge) beginning in March 2026, as well as continued investments in key strategic initiatives including supporting organic growth, new products, and ongoing scale and efficiency efforts. These factors contributed to higher compensation and benefits expenses, reflecting growth in headcount, including financial consultants and wealth advisors, and higher incentive compensation, higher professional services and occupancy and equipment expenses, and, for the quarter-to-date period, higher industry fees within other expense.

Return on average common stockholders’ equity was 25% and 23% for the second quarter and first six months of 2026, respectively, up from 19% and 18% from the same periods in 2025. These increases were due primarily to growth in net income, which more than offset higher average common stockholders’ equity. Return on tangible common equity (1) was 44% and 41% for the second quarter and first half of 2026, respectively, rising from 35% and 34% from the same 2025 periods, as growth in adjusted net income available to common stockholders (1) more than offset growth in average common stockholders’ equity. Average common stockholders’ equity increased as a result of growth in retained earnings and improved average accumulated other comprehensive income (AOCI), partially offset by higher treasury stock due to common stock repurchases in 2025 and the first half of 2026. The improvement in average AOCI resulted from amortization of losses on securities previously transferred from AFS to HTM and lower unrealized losses on AFS securities.

Schwab continued to support our clients’ evolving needs through effective management of the balance sheet and financial resources, including sustained demand for margin and bank lending in the first half of 2026. Total balance sheet assets were $517.3 billion at June 30, increasing 5% from year-end 2025. Client demand for margin loans was strong, with receivables from brokerage clients reaching $122.8 billion at June 30, rising 16% during the second quarter and 17% year-to-date. Bank loans totaled $67.0 billion at June 30, 2026, rising 16% year-to-date and 10% during the second quarter, reflecting growth in pledged asset lines (PALs) and first lien residential real estate mortgage loans (First Mortgages).

During the second quarter and first six months of 2026, the Company repurchased common stock of $1.0 billion and $3.4 billion, respectively, and also increased its common dividend by 19% to $.32 per share during the first quarter of the year. During the second quarter, the Company issued $1.5 billion of Series L preferred stock, and redeemed $2.1 billion of Series I preferred stock. Inclusive of both returns of capital and capital generation during the first half of 2026 from earnings, the Company’s consolidated Tier 1 Leverage Ratio at June 30, 2026 was 8.7%, down from 9.3% at year-end 2025. Our consolidated adjusted Tier 1 Leverage Ratio (1) was 6.8% at the end of the second quarter, down from 7.1% at year-end 2025, and within our long-term operating objective of 6.75% - 7.00%.

(1) Adjusted diluted EPS, adjusted total expenses, return on tangible common equity, adjusted net income available to common stockholders, and adjusted Tier 1 Leverage Ratio are non-GAAP financial measures. See Non-GAAP Financial Measures for further details and a reconciliation of such measures to GAAP reported results.

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THE CHARLES SCHWAB CORPORATION

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Tabular Amounts in Millions, Except Ratios, or as Noted)

Acquisition of Forge

On March 2, 2026, Schwab completed its acquisition of Forge, an operator of a leading private market platform and trading marketplace, for $636 million of cash and other consideration. Integration work is progressing, and we anticipate that incorporating Forge’s private company investment capabilities will enhance our ability to meet the evolving needs of investors across our growing client base. Our condensed consolidated financial statements include the financial condition and results of operations for Forge beginning on March 2, 2026. See also Item 1 – Note 3.

Crypto Trading Offer

In May 2026, Schwab began a phased rollout to retail clients of Schwab CryptoTM, our spot crypto trading offer. The Company provides clients direct access to bitcoin and ether trading, combined with educational content and professional support with investment experience. Charles Schwab Premier Bank, SSB (CSPB), serves as the custodian of clients’ digital assets, responsible for safekeeping and record-keeping. CSPB has engaged Paxos Trust Company, NA (sub-custodian), a regulated blockchain infrastructure provider, to deliver sub-custody and trade execution services, and we may engage one or more additional sub-custodians in the future. Over time, CSPB plans to add additional cryptocurrencies to the platform, as well as transfer capabilities for in-kind deposits and withdrawals, allowing clients with existing digital asset investments to bring them to the Schwab platform alongside their other investments.

CURRENT REGULATORY AND OTHER DEVELOPMENTS

In March 2026, federal district courts reached final resolutions on pending litigation and formally vacated the U.S. Department of Labor’s April 2024 final rule to broaden the definition of “fiduciary” under the Employee Retirement Income Security Act of 1974. Following the courts’ ruling, the U.S. Department of Labor’s Employee Benefits Security Administration removed the rule from the Code of Federal Regulations.

In March 2026, the U.S. federal banking agencies issued a notice of proposed rulemaking regarding amendments to the regulatory capital rules. The March 2026 proposal would replace the banking agencies’ 2023 proposal, and, among other things would require us to include AOCI in regulatory capital under a revised standardized approach, subject to a five-year phase-in period. The comment period for the proposed rules ended on June 18, 2026. The Company’s capital management for consolidated CSC and our banking subsidiaries incorporates measures that are inclusive of AOCI, and we do not anticipate that the proposed rules will have a material impact to the Company’s business, financial condition, or results of operations.

Refer to Part II – Item 7 – Current Regulatory and Other Developments in our 2025 Form 10-K for information regarding pending regulatory matters, including the U.S. federal banking agencies’ August 2023 proposed rulemaking on long-term debt requirements for certain large banking organizations.

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THE CHARLES SCHWAB CORPORATION

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Tabular Amounts in Millions, Except Ratios, or as Noted)

RESULTS OF OPERATIONS

Total Net Revenues

The following tables present a comparison of revenue by category:

Three Months Ended June 30,			2026				2025
	Percent Change		Amount		% of Total Net Revenues		Amount		% of Total Net Revenues
Net interest revenue
Interest revenue	9	%	$	4,146	59	%	$	3,787	65	%
Interest expense	(18)	%	(789)		(12)	%	(965)		(17)	%
Net interest revenue	19	%	3,357		47	%	2,822		48	%
Asset management and administration fees
Mutual funds, exchange-traded funds (ETFs), collective trust funds (CTFs), and alternatives (1)	14	%	1,020		14	%	898		15	%
Managed investing solutions	20	%	707		10	%	589		10	%
Other	18	%	98		2	%	83		2	%
Asset management and administration fees	16	%	1,825		26	%	1,570		27	%
Trading revenue
Commissions	23	%	528		7	%	431		7	%
Order flow revenue	34	%	624		9	%	466		8	%
Principal transactions	15	%	63		1	%	55		1	%
Trading revenue	28	%	1,215		17	%	952		16	%
Bank deposit account fees	35	%	333		5	%	247		4	%
Other	32	%	342		5	%	260		5	%
Total net revenues	21	%	$	7,072	100	%	$	5,851	100	%

Six Months Ended June 30,			2026				2025
	Percent Change		Amount		% of Total Net Revenues		Amount		% of Total Net Revenues
Net interest revenue
Interest revenue	7	%	$	8,108	60	%	$	7,544	66	%
Interest expense	(20)	%	(1,607)		(12)	%	(2,016)		(18)	%
Net interest revenue	18	%	6,501		48	%	5,528		48	%
Asset management and administration fees
Mutual funds, ETFs, CTFs, and alternatives (1)	13	%	2,011		15	%	1,776		16	%
Managed investing solutions	19	%	1,381		10	%	1,158		10	%
Other	16	%	192		1	%	166		1	%
Asset management and administration fees	16	%	3,584

Loading holders...

Held by

holders ( registered funds via N-PORT, institutional investors via 13F). Showing top by dollar value.

Holder	Type	ETF	MF	Position ($)	% of holder	Δ % of holder	Holder AUM

Recent insider activity

Last 90 days. Open-market trades (purchases & sales) by directors, officers, and 10%+ owners. 34 transactions across 10 insiders. Net: -1,338,033 shares, -$143,792,179.

Date	Insider	Role	Action	Shares	Price	Value
2026-09-01	Hathi Neesha indirect	MD, Head Wealth Adv, Bnk, Tst	Sell	-3,177	$109.04	-$346,428
2026-08-28	Bettinger Walter W indirect	Co-Chairman	Sell	-74,388	$110.91	-$8,250,648
2026-08-28	Hathi Neesha indirect	MD, Head Wealth Adv, Bnk, Tst	Sell	-3,177	$108.12	-$343,498
2026-08-26	Schwab-Pomerantz Carolyn indirect	Director	Sell	-9,175	$109.25	-$1,002,397
2026-08-24	Schwab Charles R. indirect	Co-Chairman	Sell	-117,000	$113.20	-$13,244,412
2026-08-24	Bettinger Walter W indirect	Co-Chairman	Sell	-176,210	$113.49	-$19,997,368
2026-08-17	Beatty Jonathan S indirect	MD, Head of Advisor Services	Sell	-1,000	$111.33	-$111,330
2026-08-14	Craig Jonathan M. indirect	MD, Head of Retail Investing	Sell	-21,866	$111.03	-$2,427,688
2026-08-13	Howard Dennis	MD, Chief Tech, OPS & Data Off	Sell	-2,198	$110.00	-$241,780
2026-08-12	Schwab Charles R. indirect	Co-Chairman	Sell	-46,410	$108.18	-$5,020,448
2026-08-11	Schwab Charles R. indirect	Co-Chairman	Sell	-46,445	$107.78	-$5,005,717
2026-08-07	SNEED PAULA A indirect	Director	Sell	-5,263	$107.15	-$563,954
2026-08-10	Murtagh Nigel J	Chief Risk Officer	Sell	-24,778	$109.01	-$2,701,015
2026-08-06	Murtagh Nigel J	Chief Risk Officer	Sell	-1,897	$109.00	-$206,776
2026-08-05	Schwab-Pomerantz Carolyn indirect	Director	Sell	-18,561	$107.70	-$1,999,016
2026-08-05	Craig Jonathan M. indirect	MD, Head of Retail Investing	Sell	-21,750	$107.02	-$2,327,752
2026-08-04	Schwab-Pomerantz Carolyn indirect	Director	Sell	-22,640	$106.36	-$2,408,036
2026-08-04	Schwab Charles R. indirect	Co-Chairman	Sell	-47,650	$106.08	-$5,054,569
2026-08-03	Schwab Charles R. indirect	Co-Chairman	Sell	-95,250	$105.52	-$10,050,418
2026-07-29	Schwab Charles R. indirect	Co-Chairman	Sell	-95,450	$105.82	-$10,100,061
2026-07-28	Schwab Charles R. indirect	Co-Chairman	Sell	-48,000	$105.60	-$5,068,627
2026-07-28	Schwab-Pomerantz Carolyn indirect	Director	Sell	-22,650	$105.71	-$2,394,399
2026-07-28	Howard Dennis	MD, Chief Tech, OPS & Data Off	Sell	-28,000	$105.01	-$2,940,263
2026-07-28	Bettinger Walter W indirect	Co-Chairman	Sell	-93,408 ×3	$104.64	-$9,773,988
2026-07-27	Bettinger Walter W indirect	Co-Chairman	Sell	-192,488	$103.90	-$19,999,927
2026-07-27	Murtagh Nigel J	Chief Risk Officer	Sell	-32,947 ×2	$104.01	-$3,426,837
2026-07-24	Schwab Charles R. indirect	Co-Chairman	Sell	-45,500	$101.72	-$4,628,192
2026-07-23	Morgan Peter J. III	General Counsel	Sell	-6,952	$102.03	-$709,341
2026-07-21	Murtagh Nigel J	Chief Risk Officer	Sell	-4,053	$104.14	-$422,069
2026-07-21	Beatty Jonathan S indirect	MD, Head of Advisor Services	Sell	-2,000	$104.21	-$208,411
2026-07-07	Craig Jonathan M. indirect	MD, Head of Retail Investing	Sell	-21,750	$102.01	-$2,218,722
2026-07-07	Beatty Jonathan S indirect	MD, Head of Advisor Services	Sell	-2,000	$102.01	-$204,018
2026-07-06	Beatty Jonathan S indirect	MD, Head of Advisor Services	Sell	-2,000	$100.01	-$200,015
2026-07-02	Beatty Jonathan S indirect	MD, Head of Advisor Services	Sell	-2,000	$97.03	-$194,059

Source: SEC Form 4 filings.

Next expected filings

~2026-11-07 10-Q expected by 2026-11-08 (in 55 days)
~2027-02-25 10-K expected by 2027-03-17 (in 165 days)
~2027-05-08 10-Q expected by 2027-05-09 (in 237 days)
~2027-08-07 10-Q expected by 2027-08-08 (in 328 days)

Predicted from historical filing cadence; not an SEC commitment.

Recent SEC filings

2026-08-12 8-K Other Events; Financial Statements and Exhibits
2026-08-12 424B5 Prospectus Supplement
2026-08-07 10-Q Quarterly Report
2026-07-21 8-K Earnings Release; Financial Statements and Exhibits
2026-06-29 8-K Other Events; Financial Statements and Exhibits
2026-06-26 424B5 Prospectus Supplement
2026-05-21 8-K Other Events; Financial Statements and Exhibits
2026-05-20 424B5 Prospectus Supplement
2026-05-08 10-Q Quarterly Report
2026-04-22 8-K Material Modification to Rights; Bylaws/Articles Amended; Other Events; Financial Statements and Exhibits
2026-04-22 424B5 Prospectus Supplement
2026-04-16 8-K Earnings Release; Financial Statements and Exhibits
2026-04-06 DEF 14A Proxy Statement
2026-02-25 10-K Annual Report
2026-01-29 8-K Officer/Director Change; Regulation FD Disclosure; Financial Statements and Exhibits

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