Northern Trust (NTRS) Q3 2025 earnings summary

Executive summary

• Achieved fifth consecutive quarter of positive organic growth and operating leverage, with Q3 2025 revenue up 6% and EPS up 14% year-over-year, driven by strategic initiatives, AI adoption, and expanded client solutions.

• Net income for Q3 2025 was $457.6 million, up 9% sequentially but down 2% year-over-year; diluted EPS was $2.29.

• ROE reached 14.8%, at the high end of the target range.

• Expanded Family Office Solutions, launched new fixed income ETFs, and appointed a new president.

• AI adoption accelerated, with over 150 use cases improving efficiency and productivity across all business lines.

Financial highlights

• Q3 2025 revenue was $2,030.9 million, up 3% year-over-year; trust, investment, and other servicing fees rose 6% to $1.27 billion.

• Net interest income (FTE) was $596.3 million, up 5% year-over-year; net interest margin at 1.70%.

• Noninterest expense for Q3 2025 rose 5% to $1.42 billion, mainly due to higher compensation and software costs.

• Assets under custody/administration reached $18.25 trillion, up 5% year-over-year; assets under management rose 9% to $1.77 trillion.

• Credit quality remained strong; $17 million credit reserve release in Q3.

Outlook and guidance

• Operating expense growth expected to remain below 5% for the full year, excluding notable items and currency effects.

• Full-year NII expected to grow by mid to high single digits over the prior year; NII in 2026 projected to be flat to up 1-2%, assuming up to two Fed rate cuts.

• Management expects continued growth in trust and investment fees, supported by favorable markets and new business.

• Committed to maintaining pre-tax margin above 30% medium-term, even with potential rate cuts.

• Capital ratios are expected to remain strong, with regulatory requirements met or exceeded.