Bank of America (BAC) Stock: Consumer Spending Drives Earnings Beat

TLDR

• Bank of America reported Q4 2025 profit of $7.6 billion, up 12% year-over-year, beating analyst expectations at $0.98 per share
• Consumer spending on debit and credit cards increased 6%, while credit card delinquencies over 90 days dropped to 1.27% from 1.35%
• Total revenue reached $28.37 billion, exceeding Wall Street estimates by 2.8%, with net interest income up 10% to $15.8 billion
• Sales and trading revenue climbed 10% to $4.52 billion, while investment banking fees rose to $1.67 billion
• Full-year 2025 profit hit $30.51 billion, representing a 13% increase from the previous year

Bank of America posted fourth quarter earnings that topped Wall Street predictions. The Charlotte-based bank earned $7.6 billion during the final three months of 2025.

That works out to $0.98 per share. Analysts had expected $0.96 per share.

The results paint a picture of healthy consumer behavior. Spending on debit and credit cards jumped 6% compared to the same period last year.

Bank of America Corporation, BAC

Chief Financial Officer Alastair Borthwick told reporters the consumer remains resilient. He pointed to multiple metrics showing strength in consumer finances.

Credit card delinquencies tell a similar story. The rate of credit cards overdue by more than 90 days fell to 1.27%. Last year at this time, that figure stood at 1.35%.

Total revenue for the quarter reached $28.37 billion. That beat analyst forecasts by a comfortable margin.

Net interest income grew 10% to $15.8 billion. This metric measures the difference between what banks earn on loans and what they pay depositors.

The net interest margin came in at 2.1%. Analysts had predicted 2%.

Trading and Investment Banking Show Growth

The bank’s markets division performed well. Sales and trading revenue hit $4.52 billion, up 10% from last year.

Investment banking fees also climbed. The bank collected $1.67 billion in fees during the quarter.

Provisions for credit losses dropped to $1.3 billion. This represents money set aside to cover potential loan defaults.

The bank’s efficiency ratio came in at 61.5%. Analysts expected 62.7%. A lower ratio indicates better cost management.

Full Year Performance

For all of 2025, Bank of America earned $30.51 billion. That’s a 13% jump from 2024.

Tangible book value per share reached $28.73. This grew 7.5% year-over-year and matched analyst estimates.

The bank serves approximately 67 million consumer and small business clients. Revenue over the past five years grew at a 5.7% compounded annual rate.

President Trump recently proposed capping credit card interest rates at 10% for one year. Industry groups have expressed concerns about reduced credit availability.

Borthwick declined specific comment on the proposal. He said the bank supports the administration’s efforts on affordability.

JPMorgan CEO Jamie Dimon reported similar consumer trends on Tuesday. He noted continued spending but flagged geopolitical risks.

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