Morgan Stanley (MS) Q3 2024 earnings summary

Executive summary

• Q3 2024 net revenues reached $15.4 billion, up 16% year-over-year, with net income of $3.2 billion and EPS of $1.88–$1.91, reflecting strong performance and growth across all business segments.

• Return on tangible common equity (ROTCE) was 17.5% for the quarter and 18.2% year-to-date; return on equity (ROE) was 13.1% for Q3 and 13.5% year-to-date.

• Total client assets surpassed $7.5 trillion, with Wealth Management client assets at $6 trillion and strong net asset inflows.

• Strategic investments, global integration, and robust client engagement drove share gains and record results in Wealth and Institutional businesses.

• Expense efficiency ratio improved to 72%, reflecting disciplined expense management.

Financial highlights

• Net revenues were $15.4 billion, up 16% year-over-year and 2% sequentially; net income was $3.2 billion, up 32% year-over-year.

• Diluted EPS for Q3 was $1.88–$1.91, up 36–38% year-over-year; book value per share grew to $58.25, and tangible book value per share to $43.76.

• Pre-tax margin improved to 27% from 24% a year ago; expense efficiency ratio held at 72%.

• Compensation and benefits were 44% of net revenues; non-compensation expenses were 28% of net revenues.

• Provision for credit losses decreased 41% year-over-year to $79 million, reflecting improved credit quality.

Outlook and guidance

• Management remains focused on durable growth, long-term shareholder returns, and disciplined expense management.

• Constructive outlook for Investment Banking and global markets, with expectations for IPO and M&A activity to recover.

• NII expected to be modestly down in Q4 due to lower rate expectations; asset management fee-based revenues expected to remain a durable growth driver.

• ROTCE goal remains at 20% in a normal market environment, subject to market and economic factors.

• Focus remains on capital strength and expense efficiency amid evolving market and macroeconomic conditions.