Big banks beat Q3 earnings expectations, with modest growth in mortgages

Third-quarter earnings for big banks Wells Fargo, JPMorgan Chase and Citigroup Inc. surpassed investor expectations on Tuesday, marking Wall Street’s resilience during fickle economic times.

Wells Fargo’s revenue for Q3 2025 reached $21.43 billion, compared to an expected $21.14 billion. As a result, the company’s stock surged 7.51% and closed at $82.08 in pre-market trading.

“Revenue increased 5% from a year ago with growth in both net interest income and strong fee-based revenue,” CEO Charlie Scharf told investors during Tuesday’s earnings call. 

Wells Fargo’s earnings release also noted that, effective Tuesday, Scharf was appointed as the company’s chairman of the board. 

Wells Fargo reported $7 billion in mortgage originations from July through September, down from $7.4 billion in the second quarter, but up 27% from the third quarter of 2024. Total mortgage revenue rose 45% year over year. 

Similarly, JPMorgan Chase also surpassed expectations as profits climbed 12% annually to $14.4 billion and revenue rose 9% to $47.1 billion. The company originated $13.9 billion in mortgages across its retail and correspondent channels. 

Citi reported Q3 2025 net income of $3.8 billion on $22.1 billion in revenue, up from the figures of $3.2 billion and $20.2 billion in the same period last year.

“Revenues were up 9% and every business had record third-quarter revenue, improved returns and positive operating leverage,” Citi CEO Jane Fraser said. “Despite low volatility, markets delivered its best third quarter ever with revenues up 15%. Banking revenues were up 34%.”

Citi originated $4.6 billion in originations during the quarter, up from $4.2 billion in Q2 2025.

Mortgage activity for the third quarter came in mostly as expected, according to analysts from Keefe, Bruyette & Woods (KBW). Loan volumes were up 3% at JPMorgan, down 5% at Wells Fargo and down 2% at Citigroup, which roughly matched the Mortgage Bankers Association’s forecast for flat activity.

KBW noted that gain-on-sale margins improved, rising 13 basis points at JPMorgan and 23 basis points at Wells Fargo, although the latter’s gain likely has little impact on the broader market because of its smaller market share.

“We would expect a fairly neutral reaction from our coverage universe,” the report concluded.

Mortgage business details

Wells Fargo posted net income of $5.6 billion ($1.66 per share) for Q3 2025, representing a 9% increase from the same period last year. Revenue growth was driven by both net interest income, which rose 2% year over year to $12 billion, and noninterest income, which increased 9% to $9.5 billion.

Home lending posted revenue of $870 million, up 3% year over year and 6% from the prior quarter. Wells Fargo said this was driven by higher mortgage banking fees, including gains from the sale of mortgage servicing rights (MSRs), which were partially offset by lower net interest income due to smaller loan balances.

JPMorgan’s home lending segment held steady at $1.26 billion, up from last quarter’s $1.25 billion figure. Mortgage servicing revenue climbed to $199 million from Q2 2025’s $196 million, and its MSR book value inched up from $9 billion to $9.1 billion between the second and third quarters.

Jeremy Barnum, JPMorgan’s chief financial officer, offered minimal context in Tuesday’s earnings call, adding that the company is experimenting with shorter commentary “to minimize the amount of time spent on repeating what you have already seen in the earnings materials.”

But Barnum remarked that the rebound in lending is “mirroring the pickup in deal activity across our investment-banking businesses.”

Net servicing income for Wells Fargo increased to $152 million from last quarter’s $136 million figure and was up 33% annually. The company’s MSRs book value was $6.1 billion, down from Q2 2025’s $6.4 billion.

“The momentum we are building across our businesses drove strong financial results in the third quarter with net income and diluted earnings per share both up from a year ago and the second quarter,” Scharf said.

“Credit performance was strong and continued to improve. We returned a significant amount of capital to our shareholders in the third quarter, including increasing our common stock dividend by 12.5% and repurchasing $6.1 billion of common stock.”

Wells Fargo expects its full-year 2025 non-interest expenses to total approximately $54.6 billion, with an expected Q4 figure of about $13.5 billion. JPMorgan expects Q4 net interest income to be approximately $25 billion, with adjusted expenses projected at $24.5 billion

Wells Fargo outlined its ongoing transformation that focuses on simplified operations, lower costs and strategic investments. The bank noted that, since 2019, it has sold 12 businesses — including asset management, corporate trust services and its student lending portfolio. 

“Given our progress and the lifting of the asset cap, we believe now is the time to update our return goal and describe our aspirations,” Scharf said during Tuesday’s earnings call, adding that the company’s main goal is to be the top U.S. consumer and small-business bank and wealth manager

It also has a goal to be a top-five U.S. investment bank. And Scharf disclosed that Wells Fargo’s total assets at the end of Q3 2025 topped $2 trillion for the first time in the company’s history.