Charles Schwab (SCHW) kicked off earnings season for the online brokerage group this past Thursday with an earnings beat. Schwab reported earnings of 25 cents per share compared to estimates of 24 cents per share. The online broker brought in $1.57 billion in revenue. Analysts had been expecting $1.54 billion. Net income of $353 million was up nine percent from the same quarter last year.
Inside the report, there were some very interesting findings. As they have the past couple years, Schwab continued to rake in new assets at a record pace. The broker brought in $37 billion in core new assets, the most ever for the company in a second quarter. Clients opened 280,000 new brokerage accounts, which was another second quarter record for Schwab. Total client assets climbed by six percent to $2.54 trillion. Lower trading income was the drawback in the quarter. Trading income dropped four percent year over year. Asset management and administration fees grew by six percent in the second quarter.
StockBrokers.com has blogged extensively about the Schwab Intelligent Portfolios (Robo-Advisor) service. The computer-managed service had more than 39,000 accounts and $3 billion in assets by the end of the second quarter. The project launched on March 9.
Schwab delivered an impressive pre-tax profit margin of 36.2 percent in the quarter. The stock market cheered this report. Shares of SCHW hit a new 52 week high on Friday.
Click here for the full second quarter earnings press release from Schwab.