JPMorgan (JPM) Stock: Fourth-Quarter Profit Drops 7% Despite Beating Adjusted Earnings Expectations

TLDR

• JPMorgan reported fourth-quarter net income of $13 billion, down 7% from last year, but adjusted earnings of $5.23 per share beat Wall Street’s $4.85 estimate
• The bank took a $2.2 billion hit from acquiring the Apple Card portfolio from Goldman Sachs, which was announced last week
• Full-year 2025 net income dropped to $57 billion from a record $58.5 billion in 2024, though revenue hit an all-time high of $182 billion
• JPMorgan projects 2026 expenses to jump 9% to $105 billion and net interest income to grow 3% to $95 billion
• The stock rose 0.3% in premarket trading and has climbed 33% over the past year, with market value crossing $900 billion this month

JPMorgan Chase reported mixed fourth-quarter results Tuesday morning, with profit falling from last year but adjusted earnings topping analyst estimates.

The nation’s largest bank posted net income of $13 billion for the quarter, a 7% drop from the same period a year ago. On a per-share basis, earnings came to $4.63, missing the $4.85 forecast.

However, those numbers included a $2.2 billion charge related to the bank’s deal to take over the Apple Card business from Goldman Sachs. Without that hit, profit jumped to $14.7 billion, or $5.23 per share, beating Wall Street expectations.

JPMorgan Chase & Co., JPM

Firmwide revenue climbed 7% to $45.8 billion for the quarter. Net interest income, which measures what banks earn from loans minus what they pay depositors, rose 7% to $25.1 billion.

The payments business had a particularly strong showing, generating record revenue of $5.1 billion, up 9% from last year. Higher deposit balances and fees drove the growth.

He noted that while labor markets have softened, conditions aren’t getting worse. Consumers keep spending and businesses generally stay healthy, according to the CEO.

Markets May Underestimate Risks

Those hazards include complex geopolitical conditions, the risk of sticky inflation, and elevated asset prices. It’s a familiar refrain from the longtime banking chief, who has cautioned about economic risks for years.

JPMorgan’s trading desks had a solid quarter. Core Wall Street fee revenues from equities, fixed income, currency and commodity trading jumped 15% from the fourth quarter of 2024.

That performance beat analyst expectations. However, dealmaking revenue slipped 4% from the year-ago quarter, missing forecasts due to lower fees in bond and equity underwriting.

For the full year, JPMorgan earned $57 billion in net income, down from $58.5 billion in 2024. But 2025 still marked the bank’s second-best year ever for profit.

Annual revenue hit $182 billion, an all-time high for the bank. Investment banking fees rose 8% to $9.6 billion, while client trading climbed 8% to $30 billion.

Looking Ahead to 2026

The bank provided guidance for the coming year. JPMorgan expects expenses to increase 9% to $105 billion in 2026.

Net interest income should grow 3% to $95 billion, excluding the markets business. The expense forecast had already been shared last month by Marianne Lake, head of the consumer and community bank.

That guidance initially sent shares down nearly 5% in December. Analysts say the forecast may actually be conservative, noting JPMorgan has a history of coming in below expense guidance.

JPMorgan shares rose 0.3% in premarket trading Tuesday. The stock has gained 33% over the past year, outpacing the S&P 500’s 20% rise.

This month the bank’s market value crossed $900 billion on a closing basis for the first time. That makes JPMorgan just the 13th U.S. company to reach that milestone.

The Apple Card deal will expand JPMorgan’s credit card business, adding more than $20 billion in card balances. The transaction comes as President Trump called for a 10% cap on credit card interest rates, though analysts question whether he has authority to impose such a limit.

For 2025, cards’ net charge-offs, a key measure of credit quality, came in at 3.3%. The bank landed several high-profile deals during the year, including advisory roles in the Electronic Arts leveraged buyout and serving as lead bookrunner for Medline’s IPO.

JPMorgan marked its thirteenth straight year as number one in worldwide investment banking revenue, according to Dealogic.

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