State Street (STT) Q3 2026 earnings summary

Executive summary

• 3Q26 revenue was $4.004B, up 13% YoY; net income was $1.09B, up 27%, and diluted EPS was $3.69, up 33%.

• Operating leverage was 531 bps; pre-tax margin reached 34.6% and ROTCE was 25.1%, up 3.5 and 4.2 percentage points YoY.

• Record servicing and management fees, FX client volumes, AUC/A and AUM reflected broad-based franchise momentum.

• Strategy emphasizes integrated client offerings, alternatives, digital assets and wealth, with technology and AI-enabled transformation.

Financial highlights

• Total fee revenue was $3.140B, up 11% YoY; growth was 12% excluding the ~$30M impact from prior-year strategic investment gains.

• NII rose 21% YoY to $864M, with NIM up 16 bps to 1.12%; expenses increased 8% to $2.620B.

• Other fee revenue fell 29% to $98M, primarily due to market-related adjustments; total revenue included a $10M negative currency translation impact YoY.

• No notable items were recorded in 3Q26, 2Q26 or 3Q25; QoQ expenses declined 1%, mainly on lower incentive compensation.

Outlook and guidance

• FY26 fee revenue outlook increased to +13–14% YoY from +12–13%; NII outlook rose to +15–16% from +14–15%.

• FY26 expenses are expected to rise 8–8.5%, with positive operating leverage above 500 bps; the outlook assumes flat global equity markets and rates broadly following forward curves.

• FY26 effective tax rate is expected at ~22%; total payout ratio is expected to approach 80%, subject to market conditions and other factors.

• Q4 NII is expected to grow sequentially, likely toward the upper end of the guided range; average deposits are expected at $275B–$280B.

• Medium-term targets include a 35% pre-tax margin and mid-20s ROTCE; ~$1B in annual run-rate transformation benefits is expected by 2029.