Morgan Stanley (MS) Q2 2026 earnings summary

Executive summary

• Net revenues for Q2 2026 reached a record $21.3 billion, up 27% year-over-year, with net income of $5.6 billion and diluted EPS of $3.46, both record highs.

• ROTCE was 26.6% and ROE was 20.7% for the quarter, reflecting strong profitability.

• Expense efficiency ratio improved to 65% from 71% a year ago, indicating better cost management.

• Total client assets across Wealth and Investment Management hit $10 trillion, marking a strategic milestone.

• All business segments contributed to growth, with Institutional Securities and Wealth Management delivering record results.

Financial highlights

• Institutional Securities delivered record revenues of $11 billion, up 44% year-over-year, and pre-tax profit of $4.3 billion.

• Investment Banking revenues rose 58% year-over-year to $2.4 billion, with advisory revenues at $798 million.

• Equities revenues reached a record $6.3 billion, with strong performance across all regions, especially Asia.

• Wealth Management generated record revenues of $8.9 billion, up 14%, and pre-tax profit of $2.7 billion, with a pre-tax margin of 30.5%.

• Investment Management net revenues grew 6% to $1.6 billion, with AUM at $2 trillion and $7.5 billion in long-term net inflows.

Outlook and guidance

• Investment banking outlook remains constructive with healthy pipelines and broad-based client dialogue.

• Ongoing investments in technology, distribution, and product innovation to support future growth.

• Annual tax rate expected between 22% and 23%, with some quarterly volatility; effective tax rate for Q2 was 23.1%.

• ROTCE goal remains at 20% in a normal market environment.

• Ongoing monitoring of geopolitical risks, inflation, and monetary policy as potential headwinds.