Morgan Stanley Third Quarter 2026 Earnings Results Morgan Stanley Reports Net
Morgan Stanley Third Quarter 2026 Earnings Results Morgan Stanley Reports Net Revenues of $20.3 Billion, EPS of $3.03 and ROTCE of 22.6% NEW YORK, October 14, 2026 – Morgan Stanley (NYSE: MS) today reported net revenues of $20.3 billion for the third quarter ended September 30, 2026 compared with $18.2 billion a year ago. Net income applicable to Morgan Stanley was $4.9 billion, or $3.03 per diluted share, compared with $4.6 billion, or $2.80 per diluted share, for the same period a year ago. 1
Ted Pick,Chairman and Chief Executive Officer, said,“Morgan Stanley reported another strong quarter with net revenues of $20.3 billion, EPS of $3.03 and a ROTCE of 22.6%. The Integrated Firm is connecting the full breadth of Morgan Stanley to deliver differentiated solutions and advice for our clients. Institutional Securities benefited from global strength, led by our Equity franchise, and Wealth Management reported record revenues and added $232 billion in net new assets and $80 billion in fee-based flows. Across Wealth and Investment Management, total client assets grew to $10.5 trillion, demonstrating the scale of our platform and the strength of our franchise. We continue to invest for growth while delivering strong returns for shareholders.”
Financial Summary2,3 Firm($ millions, except per share data) 3Q 2026 3Q 2025 Net revenues $20,338 $18,224 Provision for credit losses $148 $0 Compensation expense $7,997 $7,442 Non-compensation expenses $5,715 $4,754 Pre-tax income4 $6,478 $6,028 Net income app. to MS $4,909 $4,610 Expense efficiency ratio5 67 % 67 % Earnings per diluted share1 $3.03 $2.80 Book value per share $68.59 $62.98 Tangible book value per share6 $53.96 $48.64 Return on equity 17.8 % 18.0 % Return on tangible common equity6 22.6 % 23.5 % Institutional Securities Net revenues $10,029 $8,523 Investment Banking $2,159 $2,108 Equity $5,799 $4,116 Fixed Income $2,011 $2,169 Wealth Management Net revenues $9,065 $8,234 Fee-based client assets ($ billions)7 $3,155 $2,653 Fee-based asset flows ($ billions)8 $80.5 $41.9 Net new assets ($ billions)9 $232.4 $81.0 Loans ($ billions) $201.1 $173.9 Investment Management Net revenues $1,459 $1,651 AUM ($ billions)10 $2,046 $1,807 Long-term net flows ($ billions)11 $15.8 $17.9
Highlights • The Firm reported strong net revenues of $20.3 billion and pre-tax income of $6.5 billion demonstrating the continued momentum of our Integrated Firm. 4 • The Firm delivered a strong ROTCE of 22.6%. 2,6 • The expense efficiency ratio was 66% year to date, demonstrating operating leverage while we continued to invest in our businesses. 3,5,12 • The Standardized Common Equity Tier 1 capital ratio was 14.9%. 13 • Institutional Securities reported net revenues of $10.0 billion reflecting strong performance in Equity driven by client engagement and strength in Advisory. • Wealth Management delivered record net revenues of $9.1 billion on robust asset management fees and higher net interest income, generating a pre-tax margin of 30.4%. 14 The business attracted net new assets of $232 billion and fee-based flows of $80 billion for the quarter. 8,9 • Investment Management results reflect net revenues of $1.5 billion, primarily driven by asset management fees on higher average AUM. 10 The quarter included positive long-term net flows of $15.8 billion. 11
Media Relations: Wesley McDade 212-761-2430 Investor Relations: Leslie Bazos 212-761-5352
Institutional Securities reported net revenues of $10.0 billion compared with $8.5 billion a year ago. Pre-tax income was $3.5 billion compared with $3.2 billion a year ago. 4
Investment Banking net revenues up 2%: • Advisory revenues increased from a year ago on higher completed M&A activity in the Americas. • Equity underwriting revenues decreased from a year ago on lower IPOs and blocks, partially offset by higher follow-on offerings. • Fixed income underwriting revenues were modestly lower than the prior year period reflecting continued strength in investment grade and non-investment grade issuances. Equity net revenues up 41%: • Equity net revenues increased on strong performance across businesses and regions driven by client engagement and strength in Asia. Fixed Income net revenues down 7%: • Fixed Income net revenues decreased from a year ago primarily due to declines in credit on lower performance in securitized products and in commodities on lower structured activity. Other: • Other net revenues decreased from a year ago primarily due to higher funding costs, partially offset by lower mark-to-market losses on corporate loans, inclusive of hedges.
• Provision for credit losses in the quarter was primarily driven by growth in our corporate and secured lending portfolios. The quarter also included charge- offs of $105 million related to certain corporate and commercial real estate loans which had been largely provisioned for in prior quarters.
• Compensation expense increased from a year ago primarily driven by higher revenues.
• Non-compensation expenses increased from a year ago primarily driven by higher execution-related expenses and increased technology spend.
Wealth Management reported record net revenues of $9.1 billion compared with $8.2 billion a year ago. Record pre-tax income of $2.8 billion resulted in a pre-tax margin of 30.4%. 4,14 Record net new assets were $232 billion, with just over half associated with IPO-related flows. 9 Fee-based flows were $80 billion, demonstrating continued strength in our Advisor-led channel, and included a new corporate retirement mandate. 8
Net revenues up 10%: • Record asset management revenues increased from a year ago on asset growth primarily driven by higher market levels and the cumulative impact of strong fee-based flows. 8 • Transactional revenues increased from a year ago excluding the impact of mark-to-market gains on investments associated with DCP in the prior year quarter which are no longer presented in net revenues. 15 The increase was driven by continued client engagement supported by the breadth of our product offering. • Net interest income increased from a year ago primarily driven by the cumulative impact of lending growth and higher average sweep deposits. Total Expenses: • Compensation expense increased from a year ago primarily driven by higher compensable revenues. • Non-compensation expenses increased from a year ago primarily driven by higher technology spend and marketing and business development expenses.
Investment Management reported net revenues of $1.5 billion compared with $1.7 billion a year ago. Pre-tax income was $259 million compared with $364 million a year ago. 4
Net revenues down 12%: • Asset management and related fees increased from a year ago on higher average AUM driven by the cumulative impact of positive flows and higher market levels. 10 • Performance-based income and other revenues decreased from a year ago, driven by the reversal of accrued carried interest related primarily to certain investments in one of our private funds. Total Expenses: • Compensation expense decreased from a year ago primarily due to lower compensation associated with carried interest. • Non-compensation expenses increased from a year ago primarily driven by higher brokerage and clearing expenses and increased technology spend.
($ millions) 3Q 2026 3Q 2025 Net Revenues $1,459 $1,651 Asset management and related fees $1,565 $1,534 Performance-based income and other $(106) $117 Total Expenses $1,200 $1,287 Compensation $505 $632 Non-compensation $695 $655
Other Matters • The Firm repurchased $1.5 billion of its outstanding common stock during the quarter as part of its Share Repurchase Program. • The Board of Directors declared a $1.15 quarterly dividend per share payable on November 13, 2026 to common shareholders of record on October 30, 2026. • The effective tax rate for the current quarter was 23.3%.
3Q 2026 3Q 2025 Common Stock Repurchases Repurchases($MM) $1,540 $1,085 Number of Shares(MM) 7 7 Average Price $212.74 $145.77 Period End Shares(MM) 1,565 1,591 Effective Tax Rate 23.3% 22.8% Capital17 Standardized Approach CET1 capital13 14.9 % 15.1 % Tier 1 capital13 16.6 % 16.9 % Advanced Approach CET1 capital13 16.3 % 15.7 % Tier 1 capital13 18.1 % 17.6 % Leverage-based capital Tier 1 leverage18 5.9 % 6.8 % SLR19 4.8 % 5.5 %
Morgan Stanley (NYSE: MS) is a leading global financial services firm providing a wide range of investment banking, securities, wealth management and investment management services. With offices in 42 countries, the Firm’s employees serve clients worldwide including corporations, governments, institutions and individuals. For further information about Morgan Stanley, please visit www.morganstanley.com .
A financial summary follows. Financial, statistical and business-related information, as well as information regarding business and segment trends, is included in the financial supplement. Both the earnings release and the financial supplement are available online in the Investor Relations section at www.morganstanley.com .
The information provided herein and in the financial supplement, including information provided on the Firm’s earnings conference calls, may include certain non-GAAP financial measures. The definition of such measures or reconciliation of such measures to the comparable U.S. GAAP figures are included in this earnings release and the financial supplement, both of which are available on www.morganstanley.com .
This earnings release may contain forward-looking statements, including the attainment of certain financial and other targets, objectives and goals. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they are made, which reflect management’s current estimates, projections, expectations, assumptions, interpretations or beliefs and which are subject to risks and uncertainties that may cause actual results to differ materially. For a discussion of risks and uncertainties that may affect the future results of the Firm, please see “Forward-Looking Statements” preceding Part I, Item 1, “Competition” and “Supervision and Regulation” in Part I, Item 1, “Risk Factors” in Part I, Item 1A, “Legal Proceedings” in Part I, Item 3, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 and “Quantitative and Qualitative Disclosures about Risk” in Part II, Item 7A in the Firm’s Annual Report on Form 10-K for the year ended December 31, 2025 and other items throughout the Form 10-K, the Firm’s Quarterly Reports on Form 10-Q and the Firm’s Current Reports on Form 8-K, including any amendments thereto.
1 Includes preferred dividends related to the calculation of earnings per share for the third quarter of 2026 and 2025 of approximately $158 million and $160 million, respectively.
2 The Firm prepares its Consolidated Financial Statements using accounting principles generally accepted in the United States (U.S. GAAP). From time to time, Morgan Stanley may disclose certain “non-GAAP financial measures” in the course of its earnings releases, earnings conference calls, financial presentations and otherwise. The Securities and Exchange Commission defines a “non-GAAP financial measure” as a numerical measure of historical or future financial performance, financial position, or cash flows that is subject to adjustments that effectively exclude, or include amounts from the most directly comparable measure calculated and presented in accordance with U.S. GAAP. Non- GAAP financial measures disclosed by Morgan Stanley are provided as additional information to analysts, investors and other stakeholders in order to provide them with greater transparency about, or an alternative method for assessing our financial condition, operating results, or capital adequacy. These measures are not in accordance with, or a substitute for U.S. GAAP, and may be different from or inconsistent with non-GAAP financial measures used by other companies. Whenever we refer to a non-GAAP financial measure, we will also generally define it or present the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP, along with a reconciliation of the differences between the non-GAAP financial measure we reference and such comparable U.S. GAAP financial measure.
3 Our earnings releases, earnings conference calls, financial presentations and other communications may also include certain metrics which we believe to be useful to us, analysts, investors, and other stakeholders by providing further transparency about, or an additional means of assessing, our financial condition and operating results.
5 The expense efficiency ratio represents total non-interest expenses as a percentage of net revenues.
6 Tangible common equity is a non-GAAP financial measure that the Firm considers useful for analysts, investors and other stakeholders to allow comparability of period-to-period operating performance and capital adequacy. Tangible common equity represents common equity less goodwill and intangible assets net of allowable mortgage servicing rights deduction. The calculation of return on average tangible common equity, also a non-GAAP financial measure, represents full year or annualized net income applicable to Morgan Stanley less preferred dividends as a percentage of average tangible common equity. The calculation of tangible book value per common share, also a non-GAAP financial measure, represents tangible common shareholder’s equity divided by common shares outstanding.
7 Wealth Management fee-based client assets represent the amount of assets in client accounts where the basis of payment for services is a fee calculated on those assets.
8 Wealth Management fee-based asset flows include net new fee-based assets (including asset acquisitions), net account transfers, dividends, interest, and client fees, and exclude institutional cash management related activity.
9 Wealth Management net new assets represent client asset inflows, including interest, dividends and asset acquisitions, less client asset outflows, and exclude the impact of business combinations/divestitures and the impact of fees and commissions.
11 Long-term net flows include the Equity, Fixed Income and Alternative and Solutions asset classes and excludes the Liquidity and Overlay Services asset class. During the first quarter of 2026, certain changes were made to the presentation of Investment Management AUM classifications and Net Flows. These changes had no impact on Total AUM and were made to more closely align reporting with underlying investment strategies and to conform reporting of Net Flows, excluding distributions, which for long-term products were $3 billion and $2 billion for the quarters ended September 30, 2026 and September 30, 2025, respectively, with the relevant presentations in our SEC Forms 10-K and 10-Q. For additional information, please refer to the Addendums in the Firm’s first quarter 2026 financial supplement and in "Management’s Discussion and Analysis of Financial Condition and Results of Operations – Investment Management" in the Firm's Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 available online in the Investor Relations section at www.morganstanley.com .
12 During the first quarter of 2026, as a result of a March workforce management action, we recognized severance costs of $178 million in Compensation and benefits expense. The workforce management action was related to an effort to improve operational efficiency and manage performance, rather than a change in strategy or exit of businesses. The action occurred across our business segments and geographic regions and impacted approximately 2% of our global workforce at that time. We recorded severance costs of $94 million in the Institutional Securities business segment, $61 million in the Wealth Management business segment, and $23 million in the Investment Management business segment. These costs were incurred across all regions, with the majority in the Americas.
13 CET1 capital is defined as Common Equity Tier 1 capital. The Firm’s risk- based capital ratios are computed under each of the (i) standardized approaches for calculating credit risk and market risk risk‐weighted assets (RWAs) (the “Standardized
Approach”) and (ii) applicable advanced approaches for calculating credit risk, market risk and operational risk RWAs (the “Advanced Approach”). For information on the calculation of regulatory capital and ratios, and associated regulatory requirements, please refer to "Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources – Regulatory Requirements" in the Firm’s Annual Report on Form 10-K for the year ended December 31, 2025.
14 Pre-tax margin represents income before provision for income taxes divided by net revenues.
15 “DCP” refers to certain employee deferred cash-based compensation programs. Please refer to "Management’s Discussion and Analysis of Financial Condition and Results of Operations – Other Matters – Deferred Cash-Based Compensation” in the Firm’s Annual Report on Form 10-K for the year ended December 31, 2025.
Beginning in the first quarter of 2026, hedges for Wealth Management DCP awards were primarily transitioned to derivative instruments with changes in fair value recorded in compensation expense or in other comprehensive income within shareholder's equity and later reclassified to compensation expense in the same period as the related DCP award vests. As a result, the Firm no longer presents non-GAAP measures of net revenues and compensation expense excluding DCP. Wealth Management net revenues included mark-to-market gains associated with DCP of $206 million in the third quarter of 2025.
16 Wealth Management transactional revenues include investment banking, trading, and commissions and fee revenues.
17 Capital ratios are estimates as of the press release date, October 14, 2026 and are subject to change in the Firm's Quarterly Report on Form 10-Q for the quarter ended September 30, 2026.
18 The Tier 1 leverage ratio is a leverage-based capital requirement that measures the Firm’s leverage. Tier 1 leverage ratio utilizes Tier 1 capital as the numerator and average adjusted assets as the denominator.
19 The Firm’s supplementary leverage ratio (SLR) utilizes a Tier 1 capital numerator of approximately $98.7 billion and $91.0 billion, and supplementary leverage exposure denominator of approximately $2.04 trillion and $1.66 trillion, for the third quarter of 2026 and 2025, respectively.
– In the periods prior to 2026, the Firm presented non-GAAP financial measures to adjust net revenues and compensation expense for mark-to-market gains and losses on deferred cash-based compensation plans (DCP). Firm net revenues excluding DCP, which represents a non‐GAAP financial measure, were: 3Q25: $17,976 million, 3Q25 YTD: $52,279 million. Firm compensation expenses excluding DCP, which represents a non‐GAAP financial measure, were: 3Q25: $7,142 million, 3Q25 YTD: $21,484 million.
– Beginning in the first quarter of 2026, the Firm utilizes derivatives to hedge certain DCP awards and as a result will no longer present non-GAAP financial measures excluding DCP.
– The End Notes are an integral part of this presentation. Refer to pages 12 - 18 of the Financial Supplement for Definition of U.S. GAAP to Non-GAAP Measures, Definitions of Performance Metrics and Terms, Supplemental Quantitative Details and Calculations, and Legal Notice. 8
The End Notes are an integral part of this presentation. Refer to pages 12 - 18 of the Financial Supplement for Definition of U.S. GAAP to Non-GAAP Measures, Definitions of Performance Metrics and Terms, Supplemental Quantitative Details and Calculations, and Legal Notice. 9
Full text with the tables
Morgan Stanley Third Quarter 2026 Earnings Results Morgan Stanley Reports Net
Revenues of $20.3 Billion, EPS of $3.03 and ROTCE of 22.6% NEW YORK, October 14,
2026 – Morgan Stanley (NYSE: MS) today reported net revenues of $20.3 billion
for the third quarter ended September 30, 2026 compared with $18.2 billion a
year ago. Net income applicable to Morgan Stanley was $4.9 billion, or $3.03 per
diluted share, compared with $4.6 billion, or $2.80 per diluted share, for the
same period a year ago. 1
Ted Pick,Chairman and Chief Executive Officer,
said,“Morgan Stanley reported another strong
quarter with net revenues of $20.3 billion, EPS of
$3.03 and a ROTCE of 22.6%. The Integrated Firm is
connecting the full breadth of Morgan Stanley to
deliver differentiated solutions and advice for
our clients. Institutional Securities benefited
from global strength, led by our Equity franchise,
and Wealth Management reported record revenues and
added $232 billion in net new assets and $80
billion in fee-based flows. Across Wealth and
Investment Management, total client assets grew to
$10.5 trillion, demonstrating the scale of our
platform and the strength of our franchise. We
continue to invest for growth while delivering
strong returns for shareholders.”
Financial Summary2,3
Firm($ millions, except per share data) 3Q 2026 3Q 2025
Net revenues $20,338 $18,224
Provision for credit losses $148 $0
Compensation expense $7,997 $7,442
Non-compensation expenses $5,715 $4,754
Pre-tax income4 $6,478 $6,028
Net income app. to MS $4,909 $4,610
Expense efficiency ratio5 67 % 67 %
Earnings per diluted share1 $3.03 $2.80
Book value per share $68.59 $62.98
Tangible book value per share6 $53.96 $48.64
Return on equity 17.8 % 18.0 %
Return on tangible common equity6 22.6 % 23.5 %
Institutional Securities
Net revenues $10,029 $8,523
Investment Banking $2,159 $2,108
Equity $5,799 $4,116
Fixed Income $2,011 $2,169
Wealth Management
Net revenues $9,065 $8,234
Fee-based client assets ($ billions)7 $3,155 $2,653
Fee-based asset flows ($ billions)8 $80.5 $41.9
Net new assets ($ billions)9 $232.4 $81.0
Loans ($ billions) $201.1 $173.9
Investment Management
Net revenues $1,459 $1,651
AUM ($ billions)10 $2,046 $1,807
Long-term net flows ($ billions)11 $15.8 $17.9
Highlights • The Firm reported strong net revenues of $20.3 billion and pre-tax
income of $6.5 billion demonstrating the continued momentum of our Integrated
Firm. 4 • The Firm delivered a strong ROTCE of 22.6%. 2,6 • The expense
efficiency ratio was 66% year to date, demonstrating operating leverage while we
continued to invest in our businesses. 3,5,12 • The Standardized Common Equity
Tier 1 capital ratio was 14.9%. 13 • Institutional Securities reported net
revenues of $10.0 billion reflecting strong performance in Equity driven by
client engagement and strength in Advisory. • Wealth Management delivered record
net revenues of $9.1 billion on robust asset management fees and higher net
interest income, generating a pre-tax margin of 30.4%. 14 The business attracted
net new assets of $232 billion and fee-based flows of $80 billion for the
quarter. 8,9 • Investment Management results reflect net revenues of $1.5
billion, primarily driven by asset management fees on higher average AUM. 10 The
quarter included positive long-term net flows of $15.8 billion. 11
Media Relations: Wesley McDade 212-761-2430
Investor Relations: Leslie Bazos 212-761-5352
Third Quarter Results
Institutional Securities
Institutional Securities reported net revenues of $10.0 billion compared with
$8.5 billion a year ago. Pre-tax income was $3.5 billion compared with $3.2
billion a year ago. 4
Investment Banking net revenues up 2%: • Advisory revenues increased from a year
ago on higher completed M&A activity in the Americas. • Equity underwriting
revenues decreased from a year ago on lower IPOs and blocks, partially offset by
higher follow-on offerings. • Fixed income underwriting revenues were modestly
lower than the prior year period reflecting continued strength in investment
grade and non-investment grade issuances. Equity net revenues up 41%: • Equity
net revenues increased on strong performance across businesses and regions
driven by client engagement and strength in Asia. Fixed Income net revenues down
7%: • Fixed Income net revenues decreased from a year ago primarily due to
declines in credit on lower performance in securitized products and in
commodities on lower structured activity. Other: • Other net revenues decreased
from a year ago primarily due to higher funding costs, partially offset by lower
mark-to-market losses on corporate loans, inclusive of hedges.
($ millions) 3Q 2026 3Q 2025
Net Revenues $10,029 $8,523
Investment Banking $2,159 $2,108
Advisory $887 $684
Equity underwriting $525 $652
Fixed income underwriting $747 $772
Equity $5,799 $4,116
Fixed Income $2,011 $2,169
Other $60 $130
Provision for credit losses $141 $1
Total Expenses $6,416 $5,340
Compensation $2,632 $2,422
Non-compensation $3,784 $2,918
Provision for credit losses:
• Provision for credit losses in the quarter was primarily driven by growth in
our corporate and secured lending portfolios. The quarter also included charge-
offs of $105 million related to certain corporate and commercial real estate
loans which had been largely provisioned for in prior quarters.
Total Expenses:
• Compensation expense increased from a year ago primarily driven by higher
revenues.
• Non-compensation expenses increased from a year ago primarily driven by higher
execution-related expenses and increased technology spend.
2
Wealth Management
Wealth Management reported record net revenues of $9.1 billion compared with
$8.2 billion a year ago. Record pre-tax income of $2.8 billion resulted in a
pre-tax margin of 30.4%. 4,14 Record net new assets were $232 billion, with just
over half associated with IPO-related flows. 9 Fee-based flows were $80 billion,
demonstrating continued strength in our Advisor-led channel, and included a new
corporate retirement mandate. 8
Net revenues up 10%: • Record asset management revenues increased from a year
ago on asset growth primarily driven by higher market levels and the cumulative
impact of strong fee-based flows. 8 • Transactional revenues increased from a
year ago excluding the impact of mark-to-market gains on investments associated
with DCP in the prior year quarter which are no longer presented in net
revenues. 15 The increase was driven by continued client engagement supported by
the breadth of our product offering. • Net interest income increased from a year
ago primarily driven by the cumulative impact of lending growth and higher
average sweep deposits. Total Expenses: • Compensation expense increased from a
year ago primarily driven by higher compensable revenues. • Non-compensation
expenses increased from a year ago primarily driven by higher technology spend
and marketing and business development expenses.
($ millions) 3Q 2026 3Q 2025
Net Revenues $9,065 $8,234
Asset management $5,544 $4,789
Transactional16 $1,166 $1,308
Net interest $2,228 $1,991
Other $127 $146
Provision for credit losses $7 $(1)
Total Expenses $6,304 $5,736
Compensation $4,860 $4,388
Non-compensation $1,444 $1,348
Investment Management
Investment Management reported net revenues of $1.5 billion compared with $1.7
billion a year ago. Pre-tax income was $259 million compared with $364 million a
year ago. 4
Net revenues down 12%: • Asset management and related fees increased from a year
ago on higher average AUM driven by the cumulative impact of positive flows and
higher market levels. 10 • Performance-based income and other revenues decreased
from a year ago, driven by the reversal of accrued carried interest related
primarily to certain investments in one of our private funds. Total Expenses: •
Compensation expense decreased from a year ago primarily due to lower
compensation associated with carried interest. • Non-compensation expenses
increased from a year ago primarily driven by higher brokerage and clearing
expenses and increased technology spend.
($ millions) 3Q 2026 3Q 2025
Net Revenues $1,459 $1,651
Asset management and related fees $1,565 $1,534
Performance-based income and other $(106) $117
Total Expenses $1,200 $1,287
Compensation $505 $632
Non-compensation $695 $655
3
Other Matters • The Firm repurchased $1.5 billion of its outstanding common
stock during the quarter as part of its Share Repurchase Program. • The Board of
Directors declared a $1.15 quarterly dividend per share payable on November 13,
2026 to common shareholders of record on October 30, 2026. • The effective tax
rate for the current quarter was 23.3%.
3Q 2026 3Q 2025
Common Stock Repurchases
Repurchases($MM) $1,540 $1,085
Number of Shares(MM) 7 7
Average Price $212.74 $145.77
Period End Shares(MM) 1,565 1,591
Effective Tax Rate 23.3% 22.8%
Capital17
Standardized Approach
CET1 capital13 14.9 % 15.1 %
Tier 1 capital13 16.6 % 16.9 %
Advanced Approach
CET1 capital13 16.3 % 15.7 %
Tier 1 capital13 18.1 % 17.6 %
Leverage-based capital
Tier 1 leverage18 5.9 % 6.8 %
SLR19 4.8 % 5.5 %
4
Morgan Stanley (NYSE: MS) is a leading global financial services firm providing
a wide range of investment banking, securities, wealth management and investment
management services. With offices in 42 countries, the Firm’s employees serve
clients worldwide including corporations, governments, institutions and
individuals. For further information about Morgan Stanley, please visit
www.morganstanley.com .
A financial summary follows. Financial, statistical and business-related
information, as well as information regarding business and segment trends, is
included in the financial supplement. Both the earnings release and the
financial supplement are available online in the Investor Relations section at
www.morganstanley.com .
NOTICE:
The information provided herein and in the financial supplement, including
information provided on the Firm’s earnings conference calls, may include
certain non-GAAP financial measures. The definition of such measures or
reconciliation of such measures to the comparable U.S. GAAP figures are included
in this earnings release and the financial supplement, both of which are
available on www.morganstanley.com .
This earnings release may contain forward-looking statements, including the
attainment of certain financial and other targets, objectives and goals. Readers
are cautioned not to place undue reliance on forward-looking statements, which
speak only as of the date on which they are made, which reflect management’s
current estimates, projections, expectations, assumptions, interpretations or
beliefs and which are subject to risks and uncertainties that may cause actual
results to differ materially. For a discussion of risks and uncertainties that
may affect the future results of the Firm, please see “Forward-Looking
Statements” preceding Part I, Item 1, “Competition” and “Supervision and
Regulation” in Part I, Item 1, “Risk Factors” in Part I, Item 1A, “Legal
Proceedings” in Part I, Item 3, “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” in Part II, Item 7 and
“Quantitative and Qualitative Disclosures about Risk” in Part II, Item 7A in the
Firm’s Annual Report on Form 10-K for the year ended December 31, 2025 and other
items throughout the Form 10-K, the Firm’s Quarterly Reports on Form 10-Q and
the Firm’s Current Reports on Form 8-K, including any amendments thereto.
5
1 Includes preferred dividends related to the calculation of earnings per share
for the third quarter of 2026 and 2025 of approximately $158 million and $160
million, respectively.
2 The Firm prepares its Consolidated Financial Statements using accounting
principles generally accepted in the United States (U.S. GAAP). From time to
time, Morgan Stanley may disclose certain “non-GAAP financial measures” in the
course of its earnings releases, earnings conference calls, financial
presentations and otherwise. The Securities and Exchange Commission defines a
“non-GAAP financial measure” as a numerical measure of historical or future
financial performance, financial position, or cash flows that is subject to
adjustments that effectively exclude, or include amounts from the most directly
comparable measure calculated and presented in accordance with U.S. GAAP. Non-
GAAP financial measures disclosed by Morgan Stanley are provided as additional
information to analysts, investors and other stakeholders in order to provide
them with greater transparency about, or an alternative method for assessing our
financial condition, operating results, or capital adequacy. These measures are
not in accordance with, or a substitute for U.S. GAAP, and may be different from
or inconsistent with non-GAAP financial measures used by other companies.
Whenever we refer to a non-GAAP financial measure, we will also generally define
it or present the most directly comparable financial measure calculated and
presented in accordance with U.S. GAAP, along with a reconciliation of the
differences between the non-GAAP financial measure we reference and such
comparable U.S. GAAP financial measure.
3 Our earnings releases, earnings conference calls, financial presentations and
other communications may also include certain metrics which we believe to be
useful to us, analysts, investors, and other stakeholders by providing further
transparency about, or an additional means of assessing, our financial condition
and operating results.
4 Pre-tax income represents income before provision for income taxes.
5 The expense efficiency ratio represents total non-interest expenses as a
percentage of net revenues.
6 Tangible common equity is a non-GAAP financial measure that the Firm considers
useful for analysts, investors and other stakeholders to allow comparability of
period-to-period operating performance and capital adequacy. Tangible common
equity represents common equity less goodwill and intangible assets net of
allowable mortgage servicing rights deduction. The calculation of return on
average tangible common equity, also a non-GAAP financial measure, represents
full year or annualized net income applicable to Morgan Stanley less preferred
dividends as a percentage of average tangible common equity. The calculation of
tangible book value per common share, also a non-GAAP financial measure,
represents tangible common shareholder’s equity divided by common shares
outstanding.
7 Wealth Management fee-based client assets represent the amount of assets in
client accounts where the basis of payment for services is a fee calculated on
those assets.
8 Wealth Management fee-based asset flows include net new fee-based assets
(including asset acquisitions), net account transfers, dividends, interest, and
client fees, and exclude institutional cash management related activity.
9 Wealth Management net new assets represent client asset inflows, including
interest, dividends and asset acquisitions, less client asset outflows, and
exclude the impact of business combinations/divestitures and the impact of fees
and commissions.
10 AUM is defined as assets under management or supervision.
11 Long-term net flows include the Equity, Fixed Income and Alternative and
Solutions asset classes and excludes the Liquidity and Overlay Services asset
class. During the first quarter of 2026, certain changes were made to the
presentation of Investment Management AUM classifications and Net Flows. These
changes had no impact on Total AUM and were made to more closely align reporting
with underlying investment strategies and to conform reporting of Net Flows,
excluding distributions, which for long-term products were $3 billion and $2
billion for the quarters ended September 30, 2026 and September 30, 2025,
respectively, with the relevant presentations in our SEC Forms 10-K and 10-Q.
For additional information, please refer to the Addendums in the Firm’s first
quarter 2026 financial supplement and in "Management’s Discussion and Analysis
of Financial Condition and Results of Operations – Investment Management" in the
Firm's Quarterly Report on Form 10-Q for the quarter ended March 31, 2026
available online in the Investor Relations section at www.morganstanley.com .
12 During the first quarter of 2026, as a result of a March workforce management
action, we recognized severance costs of $178 million in Compensation and
benefits expense. The workforce management action was related to an effort to
improve operational efficiency and manage performance, rather than a change in
strategy or exit of businesses. The action occurred across our business segments
and geographic regions and impacted approximately 2% of our global workforce at
that time. We recorded severance costs of $94 million in the Institutional
Securities business segment, $61 million in the Wealth Management business
segment, and $23 million in the Investment Management business segment. These
costs were incurred across all regions, with the majority in the Americas.
13 CET1 capital is defined as Common Equity Tier 1 capital. The Firm’s risk-
based capital ratios are computed under each of the (i) standardized approaches
for calculating credit risk and market risk risk‐weighted assets (RWAs) (the
“Standardized
6
Approach”) and (ii) applicable advanced approaches for calculating credit risk,
market risk and operational risk RWAs (the “Advanced Approach”). For information
on the calculation of regulatory capital and ratios, and associated regulatory
requirements, please refer to "Management’s Discussion and Analysis of Financial
Condition and Results of Operations – Liquidity and Capital Resources –
Regulatory Requirements" in the Firm’s Annual Report on Form 10-K for the year
ended December 31, 2025.
14 Pre-tax margin represents income before provision for income taxes divided by
net revenues.
15 “DCP” refers to certain employee deferred cash-based compensation programs.
Please refer to "Management’s Discussion and Analysis of Financial Condition and
Results of Operations – Other Matters – Deferred Cash-Based Compensation” in the
Firm’s Annual Report on Form 10-K for the year ended December 31, 2025.
Beginning in the first quarter of 2026, hedges for Wealth Management DCP awards
were primarily transitioned to derivative instruments with changes in fair value
recorded in compensation expense or in other comprehensive income within
shareholder's equity and later reclassified to compensation expense in the same
period as the related DCP award vests. As a result, the Firm no longer presents
non-GAAP measures of net revenues and compensation expense excluding DCP. Wealth
Management net revenues included mark-to-market gains associated with DCP of
$206 million in the third quarter of 2025.
16 Wealth Management transactional revenues include investment banking, trading,
and commissions and fee revenues.
17 Capital ratios are estimates as of the press release date, October 14, 2026
and are subject to change in the Firm's Quarterly Report on Form 10-Q for the
quarter ended September 30, 2026.
18 The Tier 1 leverage ratio is a leverage-based capital requirement that
measures the Firm’s leverage. Tier 1 leverage ratio utilizes Tier 1 capital as
the numerator and average adjusted assets as the denominator.
19 The Firm’s supplementary leverage ratio (SLR) utilizes a Tier 1 capital
numerator of approximately $98.7 billion and $91.0 billion, and supplementary
leverage exposure denominator of approximately $2.04 trillion and $1.66
trillion, for the third quarter of 2026 and 2025, respectively.
7
… …
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… … … … … … … …
… … … … … … … …
──────────────────────────────────────────────────────────────────────────────
$ … $ … $ … … … 4 % $ 7… $ 5… 30 %
… … … … … … % 1… 1… 28 %
… … … * * 3… 1… (… …
… … … … … … % 5… 4… 19 %
… … … 5 % … % 2… 1… 14 %
… … … 9 % … % 7… 1… (… …
… … … … … 9 % 5… 4… 17 %
… … … 2 % 5 % 4… 4… 7 %
… … … … … — % 3… 3… 5 %
… … … … % … % 8… 7… 21 %
… … … … … … % 6… 5… 18 %
… … — … % * 3… 3… 4 %
… … … … … 7 % 2… 2… 12 %
… … … — % … % 4… 3… 18 %
… … … 8 % … % 3… 3… 12 %
… … … 3 % 2 % 1… 2… (4 …
… … … 4 % 6 % 1… 1… 6 %
… … … … … … % 1… 8… 30 %
… … … … … … % 4… 3… 34 %
… … … — % … % 1… 1… 16 %
… … … … … … % 4… 3… 13 %
… … … … … 7 % 2… 1… 29 %
… … … … … … % 4… 3… 27 %
$ … $ … $ … … … 7 % $ 1… $ 1… 29 %
… … … … … … % 2… 1… 48 %
… … … … … 6 % 1… 1… 29 %
… … … 9 % … … 4… 4… (1 …
$ … $ … $ … … … 7 % $ 1… $ 1… 30 %
Notes:
– In the periods prior to 2026, the Firm presented non-GAAP financial measures
to adjust net revenues and compensation expense for mark-to-market gains and
losses on deferred cash-based compensation plans (DCP). Firm net revenues
excluding DCP, which represents a non‐GAAP financial measure, were: 3Q25:
$17,976 million, 3Q25 YTD: $52,279 million. Firm compensation expenses excluding
DCP, which represents a non‐GAAP financial measure, were: 3Q25: $7,142 million,
3Q25 YTD: $21,484 million.
– Beginning in the first quarter of 2026, the Firm utilizes derivatives to hedge
certain DCP awards and as a result will no longer present non-GAAP financial
measures excluding DCP.
– The End Notes are an integral part of this presentation. Refer to pages 12 -
18 of the Financial Supplement for Definition of U.S. GAAP to Non-GAAP Measures,
Definitions of Performance Metrics and Terms, Supplemental Quantitative Details
and Calculations, and Legal Notice.
8
… … …
… … …
… … …
──────────────────────────────────────────────────────────────────────────────
$ … % … $ …
$ … % … $ …
% … %
% … %
$ … $
$ … $
% … %
% … %
% … %
% … %
% … %
— …
— … … …
— … … …
1 %
The End Notes are an integral part of this presentation. Refer to pages 12 - 18
of the Financial Supplement for Definition of U.S. GAAP to Non-GAAP Measures,
Definitions of Performance Metrics and Terms, Supplemental Quantitative Details
and Calculations, and Legal Notice.
9