10-Q · April 29, 2026
State Street Corporation reported a strong Q1 2026 with revenues of $3.80 billion, up 16% year-over-year, driven by a 15% increase in fee revenue, and net income increased by 19% to $764 million. Diluted EPS rose to…
Earnings analysis · 10-Q
STT earnings analysis
Filed October 28, 2026 · Our reading of the company's report
The latest report
State Street delivered a strong third quarter, with revenue up 13% to $4.004 billion, diluted EPS up 33% to $3.69, and pre-tax margin expanding to 34.6%. Both reportable segments grew, led by Investment Servicing…
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State Street delivered a strong third quarter, with revenue up 13% to $4.004 billion, diluted EPS up 33% to $3.69, and pre-tax margin expanding to 34.6%. Both reportable segments grew, led by Investment Servicing revenue of $3.200 billion and Investment Management revenue of $804 million, while AUC/A and AUM reached $59.173 trillion and $6.306 trillion, respectively. The principal offset was cash generation: operating cash flow was negative $12.219 billion for the first nine months, and the standardized CET1 ratio declined to 11.0% amid higher RWAs and continued capital returns.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
Reported figures
- Earnings per share
- $3.69
What stood out
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Revenue and NII accelerated
Third-quarter total revenue was $4.004 billion, up 13% from $3.545 billion in the prior-year quarter. Fee revenue increased 11% to $3.140 billion and net interest income increased 21% to $864 million.
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Strong EPS and margin expansion
Diluted EPS rose 33% to $3.69 from $2.78, while net income increased 27% to $1.090 billion. Pre-tax margin expanded 350 basis points to 34.6% from 31.1%.
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Investment Servicing remained strong
Investment Servicing revenue increased 12% to $3.200 billion, driven by 10% growth in servicing fees to $1.492 billion and 17% growth in foreign-exchange trading services to $425 million.
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Investment Management benefited from flows
Investment Management revenue grew 18% to $804 million, led by a 20% increase in management fees to $797 million. Assets under management reached $6.306 trillion, up from $5.446 trillion at September 30, 2025.
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Large servicing pipeline
Assets under custody and/or administration increased 15% year over year to $59.173 trillion. Newly announced servicing mandates totaled approximately $429 billion in the quarter, and future-period installations totaled approximately $2.98 trillion.
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Loan growth with lower provisions
Loans increased to $49.309 billion from $46.782 billion at December 31, 2025, primarily from subscription finance, overdrafts and CLOs. The third-quarter credit-loss provision was a $4 million release versus a $9 million provision in the prior-year quarter.
What to watch
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Technology investment pressures costs
Operating expenses increased 8% year over year to $2.620 billion, including a 15% increase in information-systems and communications expense to $594 million, reflecting technology, infrastructure and volume-related costs.
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Working-capital outflows weakened cash flow
Operating cash flow was negative $12.219 billion for the first nine months, versus positive $1.856 billion in the prior-year period. The outflow included a $12.330 billion increase in collateral deposits and a $4.881 billion change in unrealized foreign-exchange derivative losses.
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Capital ratio declined amid RWA growth
The standardized CET1 ratio declined to 11.0% from 11.6% at December 31, 2025, while standardized risk-weighted assets increased to $140.592 billion from $127.263 billion. Capital return included $400 million of third-quarter repurchases and $251 million of common dividends.
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Rate-related securities losses
The investment portfolio had $6.07 billion of gross pre-tax unrealized losses on 1,768 securities at September 30, 2026. Held-to-maturity securities had a carrying value of $34.116 billion but a fair value of $28.697 billion.
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Commercial real-estate credit risk
Commercial real estate loans totaled $2.270 billion, including $723 million of sub-investment-grade, $120 million of substandard and $171 million of doubtful loans. Management stated that worsening real-estate or economic conditions could require additional credit-loss provisions.
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Cyber, market and counterparty exposure
The filing highlights heightened cyber risk from frontier artificial-intelligence models, including more sophisticated attacks and social-engineering schemes. Separately, total derivative notional amounts were $3.68 trillion, including $3.55 trillion of foreign-exchange contracts, creating substantial market and counterparty exposure.
Management's outlook
No explicit numeric revenue or EPS guidance was provided. Management expects approximately 20% of the $2.98 trillion of uninstalled investment-servicing AUC/A to be installed in the remainder of 2026 and approximately 65% in 2027. Remaining non-cancelable performance obligations were approximately $2.06 billion, with approximately half expected to be recognized over the next three years.
Earlier filings 1
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.