Jan 15, 2020

JPMorgan, Citi start earnings season strong

Jamie Dimon, chairman and CEO of JP Morgan Chase. Photo: Kena Betancur/AFP via Getty Images

JPMorgan Chase and Citigroup reported better-than-expected fourth-quarter earnings on Tuesday, while Wells Fargo missed.

What happened: JPMorgan's and Citigroup's stock both gained more than 1% while Wells Fargo dropped by over 5%.

By the numbers: JPMorgan, the largest U.S. bank by assets, reported earnings of $2.57 a share and revenue rose 9% to $29.2 billion. Citi reported EPS of $1.90 and revenue, net of interest expense, rose about 7% to $18.38 billion — all of which beat analysts' expectations.

  • JPMorgan's big numbers were driven by an 86% surge in bond trading revenue, year over year.
  • Citi saw trading revenue rise nearly 31%, with a 49% jump in fixed-income trading, though equities trading fell 23% due to weak performance in derivatives.

On the other side: Wells Fargo saw total revenue decline more than 5% to $19.9 billion. Net income took an even bigger hit, falling by more than half to $2.9 billion, down $0.60 per share.

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Big banks saved billions thanks to the Trump tax cuts

Illustration: Aïda Amer/Axios

The Tax Cut and Jobs Act helped power the biggest U.S. banks to record profits for the second straight year.

Why it matters: The tax cut was sold as a way to revitalize hiring and spending by American companies to boost the economy and help struggling workers, but the windfall is largely staying with banks and their shareholders.

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Apple shares surge after it posts record holiday sales

Photo: Apple

Buoyed by strong iPhone sales and a growing services business, Apple reported record quarterly revenue and profits that were well ahead of estimates and its own forecasts. Apple also projected revenue for the current quarter ahead of many analysts' expectations, sending shares higher.

Why it matters: The October-to-December quarter includes the all-important holiday shopping season, and Apple's results show the resiliency of its business.

Go deeperArrowJan 28, 2020

Banks may struggle to recreate 2019 success

Reproduced from Bloomberg; Chart: Axios Visuals

Wall Street analysts are betting the banks can't do it three years in a row.

What they're saying: Analysis from Yardeni Research shows the average expectation is for a 0.4% decline in S&P 500 diversified banks’ 2020 revenue and only a 3.8% increase in earnings.

Go deeperArrowJan 17, 2020