State Street (STT) Q4 2025 earnings summary

Executive summary

• Achieved record fee and total revenue in Q4 and FY2025, with strong growth across Investment Services, Investment Management, and Markets franchises.

• Strategic investments in technology, AI, and digital assets, including the launch of a Digital Asset Platform, expanded client capabilities and positioned for future growth.

• Reached record AUC/A of $53.8T and AUM of $5.7T, with significant net inflows and new product launches.

• Delivered $500M in productivity savings for 2025, enabling reinvestment in growth and transformation initiatives.

• Returned over $2.1B to shareholders via buybacks and dividends, maintaining a payout ratio near 80%.

Financial highlights

• Q4 EPS grew 14% year-over-year; full-year diluted EPS (ex-notables) was $10.30, up 19% year-over-year.

• Record total revenue of ~$14B for 2025, up 7% from prior year; fee revenue of $11B, up 9% year-over-year.

• Expenses rose 5% to $9.8B, mainly due to strategic and technology investments, partially offset by productivity savings.

• Pre-tax margin for FY2025 was 29.2% (ex-notables); ROTCE was 19.6%.

• Notable items in Q4 totaled $206M pre-tax, or $0.55 per share after tax, mainly from repositioning charges and FDIC assessment.

Outlook and guidance

• FY2026 outlook assumes flat global equity markets and two Fed rate cuts; fee revenue expected to rise 4%-6%, NII up low single digits.

• Expenses projected to increase 3%-4%, with productivity savings offsetting recurring cost growth.

• Targeting positive operating leverage over 100 bps and pre-tax margin of ~30% for 2026.

• Total payout ratio expected to remain at ~80%, subject to board approval.