Morgan Stanley (MS) Earnings for the First Quarter of 2023

Morgan Stanley on Wednesday beat expectations for first-quarter earnings, posting better-than-expected trading results.

Here’s how the company did:

• Earnings of $1.70 per share, versus $1.62 Refinitiv estimates
• Revenue was $14.52 billion, compared to an estimated $13.92 billion.

The bank said profits fell 19 percent to $2.98 billion, or $1.70 per share, compared to a year earlier. Companywide revenue fell 2% to $14.52 billion.

Wealth management revenue was up 11% year-over-year to $6.56 billion, matching StreetAccount’s estimates. This increase was driven by higher net interest income amid higher rates and loan growth rather than lower asset management revenues as the markets declined.

Under CEO James Gorman, Morgan Stanley has become a wealth management behemoth thanks to a series of acquisitions. The bank gets most of its revenue from wealth management and investing, and its more stable businesses have helped offset the banks’ volatile trading and results.

“The investments we made in the wealth management business continued to pay off as we added $110 billion in net new assets during the quarter,” Gorman said in the earnings release. “Equity and fixed income returns were strong, although investment banking continued to be constrained.”

Morgan Stanley shares are up 5.7% this year prior to Wednesday, outperforming KBW Bank’s 16% drop.

JPMorgan Chase, Citigroup, Wells Fargo and Bank of America all beat expectations as companies earned more interest income amid rising interest rates. Goldman Sachs missed out on the costs associated with offloading consumer loans amid its pivot away from retail banking.

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