JPMorgan Chase reported a blockbuster quarter driven by a surge in investment banking and markets revenue, particularly a massive 86% jump in equities. The company raised its full-year NII and expense guidance on the back of a robust pipeline and strong deposit growth, while lowering its card charge-off guidance due to better-than-expected consumer credit. Management was cautiously optimistic, acknowledging the strong environment while flagging potential risks like rate convexity and regulatory overreach. Equities revenue surged 86% year-over-year, driven by major IPOs and volatile market conditions, though CFO Jeremy Barnum noted this combination of factors is unlikely to repeat.
JPMorgan Chase reported a blockbuster quarter driven by a surge in investment banking and markets revenue, particularly a massive 86% jump in equities. The company raised its full-year NII and expense guidance on the back of a robust pipeline and strong deposit growth, while lowering its card charge-off guidance due to better-than-expected consumer credit. Management was cautiously optimistic, acknowledging the strong environment while flagging potential risks like rate convexity and regulatory overreach. Equities revenue surged 86% year-over-year, driven by major IPOs and volatile market conditions, though CFO Jeremy Barnum noted this combination of factors is unlikely to repeat.
JPMorgan Chase reported a blockbuster quarter driven by a surge in investment banking and markets revenue, particularly a massive 86% jump in equities. The company raised its full-year NII and expense guidance on the back of a robust pipeline and strong deposit growth, while…
Management says AI is being deployed across roughly 1,000 use cases, with about 50 important ones in risk, fraud, marketing, hedging, prospecting, and document reading. They expect significant efficiency gains but believe the ultimate benefits will accrue to customers rather…
Guidance · revenue to $105.5B
Full-year Expense guidance raised by $2.5B to $107.5B, with $1.5B being the direct variable cost consequence of the strong revenue beat, highlighting significant operating leverage.
Management says AI is being deployed across roughly 1,000 use cases, with about 50 important ones in risk, fraud, marketing, hedging, prospecting, and document reading. They expect significant efficiency gains but believe the ultimate benefits will accrue to customers rather than permanently lift JPM’s margins, given competition. They are retraining employees and managing AI compute costs by match
Management is bullish on the future, raising NII guidance based on stronger than expected deposits and a robust investment banking pipeline, even as they caution about sustainability.
Management highlighted AI-driven capex as a major macro theme: total U.S. capex of about $4 trillion, with AI spending rising from $400 billion last year to $700 billion this year and projected to exceed $1 trillion next year. This is supporting loan growth across data centers and related supply chains, while JPM continues to invest organically across technology, branches, and hiring.
Jamie Dimon described the environment as 'close to as good as it gets' but repeatedly stressed uncertainty about how long the strong market conditions and activity levels will last.
“in the first half of this year, the capital markets complex has outperformed our then expectations by six and a half billion dollars. And we have So that says a lot about that kind of like marginal operating leverage point. And then, so th…”
“We had some major IPOs. We had some major index rebalancing. We had some very complicated dynamics in the Korean equity market. There's been a lot of activity in Asia. The overall environment has been dynamic and interesting across a whole…”
“the biggest single factor is deposit balances, I would say, across both wholesale and consumer. Both sort of the overall quantum of it, but also like mixed shift inside of that in favor of slightly higher margin overall.”
“we actually increased the equity allocation to the CIB this quarter for reasons that I think are pretty obvious in light of the amount of growth of supporting clients... that NII is moving out of, you know, NIIX into markets NII... this pi…”
| 지표 | 기간 | 범위 | 중간값 | 상태 |
|---|---|---|---|---|
| Gross marginCARD | FY2026 | 3.2% | 3.2% | LOWERED |
| Op margin | FY2026 | $107.5B | $107.5B | RAISED |
| Revenue | FY2026 | $105.5B | $105.5B | RAISED |
Jamie Dimon acknowledges Goldman Sachs as a strong competitor performing well, implicitly recognizing their successful quarter.
“Very good competition, not just Goldman Sachs, who's doing a great job, if you didn't read their numbers this morning, because I did.”
Got it. And I guess just a follow-up. On the capital front, you have excess capital, strong ROEs. But I guess the question would be, why buy back stock here at three times tangible book when things are so good, bad things could happen? Why not just have even more excess capital for a rainy day if things go south? Just talk to us in terms of How are you thinking about buybacks at these levels? And I know Jamie's talked about potential M&A at some point, maybe asset management, fintechs, but yeah, would love to revisit that. Thanks.
… time mentioning $20 billion. We could obviously do far more than that or nothing at all. What I was trying to point out is we have huge opportunities for organic growth in every single business we're in. Organic growth is hard. It's technology, it's people, it's systems, it's branches, it's bankers, it's hiring, it's training, it's recruiting. But I was surprised to find out in parts of Europe that Well, we've doubled our share in certain areas. You know, they think that we could do a lot more there, and country by country, including countries that, you know, we say aren't doing particularly well. And I think that's true here. We have our branch in the United States. We've got a credit card business. We've got the app arsenal, the Apple business at one point, which we have pretty high hopes for if we come up with, you know, better products and better services. And so, yeah, so the goal is to deploy our capital at a 17% return. That is the goal, which we think we can do over time. We should always be looking at inorganic. What we don't want to do is look at inorganic as a sign of weakness of organic, which I think companies do sometimes. They bullshit about M&A when they should be focusing on why they're not doing particularly well in the area or something like that. And we have a lot of competition, by the way, and we've pointed that out before. Very good competition, not just Goldman Sachs, who's doing a great job, if you didn't read their numbers this morning, because I did. But, you know, you've got Stripe and PayPal and Cash and Block and Chime and SoFi and Revolut, and they're good. And we have to make certain investments to keep up with them or to, you know, hopefully do a better job than some of them. And so we're doing all of that. But you should always be looking at things that could be good for your company. inorganically. And we've done a bunch of deals this year. Most were good. A couple weren't particularly good. And we're going to be looking. And we're open-minded. It wasn't any particular thing or any particular place. It might be adjacencies. It might be data-related. It might be a whole bunch of errors. We have a bunch of skunk wars going on. We hope Chase UK, that we continue to build that in a way that becomes a great European digital bank over time. It's going to take a lot of time and effort to do that. So... But you raise a good point.
Jamie Dimon lists non-bank fintech competitors, indicating they are 'good' and force JPMorgan to make certain investments to keep up.
“you've got Stripe and PayPal and Cash and Block and Chime and SoFi and Revolut, and they're good.”
Got it. And I guess just a follow-up. On the capital front, you have excess capital, strong ROEs. But I guess the question would be, why buy back stock here at three times tangible book when things are so good, bad things could happen? Why not just have even more excess capital for a rainy day if things go south? Just talk to us in terms of How are you thinking about buybacks at these levels? And I know Jamie's talked about potential M&A at some point, maybe asset management, fintechs, but yeah, would love to revisit that. Thanks.
… time mentioning $20 billion. We could obviously do far more than that or nothing at all. What I was trying to point out is we have huge opportunities for organic growth in every single business we're in. Organic growth is hard. It's technology, it's people, it's systems, it's branches, it's bankers, it's hiring, it's training, it's recruiting. But I was surprised to find out in parts of Europe that Well, we've doubled our share in certain areas. You know, they think that we could do a lot more there, and country by country, including countries that, you know, we say aren't doing particularly well. And I think that's true here. We have our branch in the United States. We've got a credit card business. We've got the app arsenal, the Apple business at one point, which we have pretty high hopes for if we come up with, you know, better products and better services. And so, yeah, so the goal is to deploy our capital at a 17% return. That is the goal, which we think we can do over time. We should always be looking at inorganic. What we don't want to do is look at inorganic as a sign of weakness of organic, which I think companies do sometimes. They bullshit about M&A when they should be focusing on why they're not doing particularly well in the area or something like that. And we have a lot of competition, by the way, and we've pointed that out before. Very good competition, not just Goldman Sachs, who's doing a great job, if you didn't read their numbers this morning, because I did. But, you know, you've got Stripe and PayPal and Cash and Block and Chime and SoFi and Revolut, and they're good. And we have to make certain investments to keep up with them or to, you know, hopefully do a better job than some of them. And so we're doing all of that. But you should always be looking at things that could be good for your company. inorganically. And we've done a bunch of deals this year. Most were good. A couple weren't particularly good. And we're going to be looking. And we're open-minded. It wasn't any particular thing or any particular place. It might be adjacencies. It might be data-related. It might be a whole bunch of errors. We have a bunch of skunk wars going on. We hope Chase UK, that we continue to build that in a way that becomes a great European digital bank over time. It's going to take a lot of time and effort to do that. So... But you raise a good point.
Jamie Dimon notes that AI tools will be available to smaller competitors through vendors like Fiserv, potentially leveling the playing field.
“over time, remember, this will be offered to smaller competitors, too, through Fiserv and FIS and other fintech companies.”
Hi, good morning. Thanks for taking my question. I have a broader question on AI, and it is, is there an argument that We're vastly underestimating the potential benefits to efficiency and its impacts on how companies can run their businesses. I know Block is a really different animal than you are on a lot of levels, but they argued when they cut 40% of their workforce that given the advancement in AI tools, if they look at their organizational structure with a blank sheet of paper, they can be much leaner and not sacrifice on product velocity and commercial outcomes. And I guess I'm asking if you think there could be a parallel with banks where you can operate with a different structure…
… AI to do a better job for our clients. That's our job. We fully expect it'll have huge efficiency in certain parts of the company. And, you know, we analyze it all the time. I think we've mentioned in the past we spend quite a bit of money on it. We have a lot of MPVs that we know we have. You know, the whole company's working on this at this point. And, you know, there are, I think there's almost 1,000 use cases today, though. I would say that the really important ones are 50 across risk, fraud, marketing, hedging, prospecting, note-taking, idea generation, document reading. and it's kind of just starting. So we do expect that. I think you have to put in the back of your mind that there are areas where we may just accelerate what we do that we want to get done anyway. Think of certain applications and customer facing things and stuff like that. We are preparing to make sure we can retrain our people and we have had discrete areas where we did reduce jobs by 30% or 40% and most of those people went for jobs elsewhere. We do expect that. I also think that over time, remember, this will be offered to smaller competitors, too, through Fiserv and FIS and other fintech companies. And over time, we've been doing this nonstop for 25 years with just large computers and mainframes and, you know, and You know, APIs and various tools and tricks we use have always been trying to create more efficient stuff like this. This will be faster. This will be dramatic. You know, the whole company's involved in it. We have our off-site in July. You know, you can imagine this is a big topic everywhere. You know, from front office to mid-office to back office to, you know, marketing to risk to you name the subject. And more to come, but we're kind of in the midst of this mini-revolution, and we'll report to you. But I do also want to point out, You know, maybe you could be ahead of other people, kind of, but what always happens is the benefit accrues to the customer, not to, you know, they're J.P. Morgan in this case. Because other people are doing the same thing and, you know, presumably leads to lower costs and lower error rates and a bunch of things. You can't just say, well, your ROE is going to go to 50% and stay there. You know, if we had a 50% ROE going to 10% a year, you'd probably have, in 50 or 60 years, you'd probably be 100% of the GDP of the United States of America.