Schwab Reports Fourth Quarter and Full Year Results

WESTLAKE, Texas--(BUSINESS WIRE)--The Charles Schwab Corporation reported net income for the fourth quarter totaling $1.8 billion, or $.94 earnings per share. Excluding $177 million of pre-tax transaction-related and restructuring costs, adjusted (1) net income and earnings per share equaled $2.0 billion and $1.01, respectively. Client Driven Growth $367B 2024 Core Net New Assets “In the fourth quarter of 2024, we added $115 billion in core net new assets, bringing asset gathering for the year to $367 billion – a 4.3% annualized growth rate. This 20% annual increase in net new assets reflects our ongoing progress following the Ameritrade integration.” CEO Rick Wurster Revenue Growth 20% 4Q24 Revenue Growth vs. 4Q23 “Strong client engagement, increased margin utilization, encouraging client cash trends, and record net inflows into our Managed Investing Solutions helped lift 4Q24 revenue to $5.3 billion, – an increase of 20% year-over-year.” CEO Rick Wurster Through- the-Cycle Profitability 46.6% 4Q24 Adjusted Pre-Tax Profit Margin (1) “The combination of 20% revenue growth and disciplined expense management resulted in a 4Q24 pre-tax profit margin of 43.3% – 46.6% adjusted (1) – as well as quarterly GAAP and adjusted (1) earnings per share growth of 84% and 49%, respectively.” CFO Mike Verdeschi Balance Sheet Management $14.9B 4Q24 Reduction in Bank Supplemental Funding (2) “Client transactional sweep cash grew by $35 billion versus 3Q24, including a $25 billion increase in December due to typical year-end seasonality. This build helped us further reduce Bank Supplemental Funding by $14.9 billion to $49.9 billion – down ~50% from peak levels.” CFO Mike Verdeschi 4Q24 Client and Business Highlights Net asset gathering helped total client assets increase 19% year-over-year to $10.10 trillion Core net new assets equaled $114.8 billion, bringing full year total to $366.9 billion – up 20% versus 2023 New brokerage account openings increased 23% year-over-year to 1.1 million for the quarter, pushing total active accounts to 36.5 million Managed Investing Solutions net inflows of $15 billion brought the full-year total to a record $55 billion – with converted Retail Ameritrade clients accounting for approximately 35% of net inflows Margin balances grew sequentially by 15% to $83.8 billion, up 34% from year-end 2023 Trading activity increased 11% relative to the prior quarter as client engagement surged following the election Retail client satisfaction scores achieved record levels, while Advisor Services promoter scores remained above pre-conversion levels Schwab was awarded America’s Best Customer Service 2025 by Newsweek (3) Schwab Mobile recognized as the #1 mobile investing app by Corporate Insight (4) Three Months Ended December 31, % Twelve Months Ended December 31, % Financial Highlights 2024 2023 Change 2024 2023 Change Net revenues (in millions) $ 5,329 $ 4,459 20 % $ 19,606 $ 18,837 4 % Net income (in millions) GAAP $ 1,840 $ 1,045 76 % $ 5,942 $ 5,067 17 % Adjusted $ 1,974 $ 1,367 44 % $ 6,433 $ 6,159 4 % Diluted earnings per common share GAAP $ .94 $ .51 84 % $ 2.99 $ 2.54 18 % Adjusted $ 1.01 $ .68 49 % $ 3.25 $ 3.13 4 % Pre-tax profit margin GAAP 43.3 % 26.8 % 39.2 % 33.9 % Adjusted 46.6 % 36.0 % 42.5 % 41.5 % Return on average common stockholders’ equity (annualized) 18 % 12 % 15 % 16 % Return on tangible common equity (annualized) 36 % 43 % 35 % 54 % Note: Items labeled “adjusted” are non-GAAP financial measures; further details on non-GAAP financial measures and a reconciliation of such measures to GAAP reported results are included on pages 10-12 of this release. All per-share results are rounded to the nearest cent, based on weighted-average diluted common shares outstanding. 4Q24 Financial Commentary Net revenues grew on both a year-over-year and sequential basis, up 20% and 10%, respectively Sequential net interest margin expanded by 25 basis points to 2.33% Client transactional sweep cash balances ended at $418.6 billion, a sequential increase of $34.6 billion Bank Supplemental Funding (2) declined sequentially by $14.9 billion to $49.9 billion at December month-end Asset management and administration fees achieved a quarterly record of $1.5 billion Trading revenue increased 14% versus 4Q23 as a result of higher volumes and changes in trading mix GAAP expenses for the quarter declined 7% versus 4Q23 Fourth quarter acquisition and integration-related costs, amortization of acquired intangibles, and restructuring costs equaled $177 million; exclusive of these items, adjusted total expenses (1) were flat year-over-year Capital ratios across the firm continue to strengthen – including preliminary consolidated Tier 1 Leverage and adjusted Tier 1 Leverage (1) reaching 9.9% and 6.8%, respectively Results reflect certain items, including the resolution of previously accrued tax and legal reserves, which contributed $.03 to both GAAP and adjusted diluted earnings per share (1) (1) Further details on non-GAAP financial measures and a reconciliation of such measures to GAAP reported results are included on pages 10-12 of this release. (2) Bank Supplemental Funding includes repurchase agreements at the banks, Schwab Bank Certificates of Deposit (CDs), and Federal Home Loan Bank balances. (3) Newsweek America’s Best Customer Service 2025 was given on October 30, 2024, and expires November 1, 2025. The criteria, evaluation, and ranking were determined by Newsweek, partnered with Statista. Visit https://d.newsweek.com/en/file/473784/newsweek-americas-best-customer-service-2025-methodology.pdf for more information. Schwab paid a licensing fee to Newsweek for use of the award and logos. (4) Schwab leads in mobile rankings in Corporate Insight’s 2024 Brokerage Experience Benchmarks (https://corporateinsight.com/the-2024-brokerage-experience-benchmarks), which evaluate the individual investor experience offered by 20 leading brokerage websites and mobile apps. This research was independently conducted by Corporate Insight using the Experience Benchmarks’ analytical frameworks that are built on over 25 years of research to provide a clear view of how the nation’s top brokerage websites and mobile apps stack up against one another in terms of functionality, design, navigation, and usability. Winter Business Update The company will host its Winter Business Update for institutional investors this morning from 7:30 a.m. - 8:30 a.m. CT, 8:30 a.m. - 9:30 a.m. ET. Registration for this Update webcast is accessible at https://www.aboutschwab.com/schwabevents. Forward-Looking Statements This press release contains forward-looking statements relating to the company’s ongoing progress following the Ameritrade acquisition; asset gathering; client cash trends; competitive position; through-the-cycle profitability; and capital ratios. These forward-looking statements reflect management’s expectations as of the date hereof. Achievement of these expectations and objectives is subject to risks and uncertainties that could cause actual results to differ materially from the expressed expectations. Important factors that may cause such differences are described in the company’s most recent reports on Form 10-K and Form 10-Q, which have been filed with the Securities and Exchange Commission and are available on the company’s website (https://www.aboutschwab.com/financial-reports) and on the Securities and Exchange Commission’s website (https://www.sec.gov). The company makes no commitment to update any forward-looking statements. About Charles Schwab The Charles Schwab Corporation (NYSE: SCHW) is a leading provider of financial services, with 36.5 million active brokerage accounts, 5.4 million workplace plan participant accounts, 2.0 million banking accounts, and $10.10 trillion in client assets. Through its operating subsidiaries, the company provides a full range of wealth management, securities brokerage, banking, asset management, custody, and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC, https://www.sipc.org), and its affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent, fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through Schwab Advisor Services. Its primary banking subsidiary, Charles Schwab Bank, SSB (member FDIC and an Equal Housing Lender), provides banking and lending services and products. More information is available at https://www.aboutschwab.com. THE CHARLES SCHWAB CORPORATION Consolidated Statements of Income (In millions, except per share amounts) (Unaudited) Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Net Revenues Interest revenue $ 3,851 $ 3,963 $ 15,537 $ 16,111 Interest expense (1,320 ) (1,833 ) (6,393 ) (6,684 ) Net interest revenue 2,531 2,130 9,144 9,427 Asset management and administration fees 1,509 1,241 5,716 4,756 Trading revenue 873 767 3,264 3,230 Bank deposit account fees 241 174 729 705 Other 175 147 753 719 Total net revenues 5,329 4,459 19,606 18,837 Expenses Excluding Interest Compensation and benefits 1,533 1,409 6,043 6,315 Professional services 297 253 1,053 1,058 Occupancy and equipment 276 331 1,060 1,254 Advertising and market development 101 104 397 397 Communications 131 144 591 629 Depreciation and amortization 224 238 916 804 Amortization of acquired intangible assets 130 130 519 534 Regulatory fees and assessments 89 270 398 547 Other 243 386 937 921 Total expenses excluding interest 3,024 3,265 11,914 12,459 Income before taxes on income 2,305 1,194 7,692 6,378 Taxes on income 465 149 1,750 1,311 Net Income 1,840 1,045 5,942 5,067 Preferred stock dividends and other 123 119 464 418 Net Income Available to Common Stockholders $ 1,717 $ 926 $ 5,478 $ 4,649 Weighted-Average Common Shares Outstanding: Basic 1,831 1,823 1,828 1,824 Diluted 1,836 1,828 1,834 1,831 Earnings Per Common Shares Outstanding (1): Basic $ .94 $ .51 $ 3.00 $ 2.55 Diluted $ .94 $ .51 $ 2.99 $ 2.54 (1) The Company has voting and nonvoting common stock outstanding. As the participation rights, including dividend and liquidation rights, are identical between the voting and nonvoting stock classes, basic and diluted earnings per share are the same for each class. THE CHARLES SCHWAB CORPORATION Financial and Operating Highlights (Unaudited) Q4-24 % change 2024 2023 vs. vs. Fourth Third Second First Fourth (In millions, except per share amounts and as noted) Q4-23 Q3-24 Quarter Quarter Quarter Quarter Quarter Net Revenues Net interest revenue 19 % 14 % $ 2,531 $ 2,222 $ 2,158 $ 2,233 $ 2,130 Asset management and administration fees 22 % 2 % 1,509 1,476 1,383 1,348 1,241 Trading revenue 14 % 10 % 873 797 777 817 767 Bank deposit account fees 39 % 59 % 241 152 153 183 174 Other 19 % (13 )% 175 200 219 159 147 Total net revenues 20 % 10 % 5,329 4,847 4,690 4,740 4,459 Expenses Excluding Interest Compensation and benefits (1) 9 % 1 % 1,533 1,522 1,450 1,538 1,409 Professional services 17 % 16 % 297 256 259 241 253 Occupancy and equipment (17 )% 2 % 276 271 248 265 331 Advertising and market development (3 )% — 101 101 107 88 104 Communications (9 )% (11 )% 131 147 172 141 144 Depreciation and amortization (6 )% (3 )% 224 231 233 228 238 Amortization of acquired intangible assets — — 130 130 129 130 130 Regulatory fees and assessments (67 )% 1 % 89 88 96 125 270 Other (2) (37 )% (6 )% 243 259 249 186 386 Total expenses excluding interest (7 )% 1 % 3,024 3,005 2,943 2,942 3,265 Income before taxes on income 93 % 25 % 2,305 1,842 1,747 1,798 1,194 Taxes on income N/M 7 % 465 434 415 436 149 Net Income 76 % 31 % 1,840 1,408 1,332 1,362 1,045 Preferred stock dividends and other 3 % 13 % 123 109 121 111 119 Net Income Available to Common Stockholders 85 % 32 % $ 1,717 $ 1,299 $ 1,211 $ 1,251 $ 926 Earnings per common share (3): Basic 84 % 32 % $ .94 $ .71 $ .66 $ .69 $ .51 Diluted 84 % 32 % $ .94 $ .71 $ .66 $ .68 $ .51 Dividends declared per common share — — $ .25 $ .25 $ .25 $ .25 $ .25 Weighted-average common shares outstanding: Basic — — 1,831 1,829 1,828 1,825 1,823 Diluted — — 1,836 1,834 1,834 1,831 1,828 Performance Measures Pre-tax profit margin 43.3 % 38.0 % 37.2 % 37.9 % 26.8 % Return on average common stockholders’ equity (annualized) (4) 18 % 14 % 14 % 15 % 12 % Financial Condition (at quarter end, in billions) Cash and cash equivalents (3 )% 21 % $ 42.1 $ 34.9 $ 25.4 $ 31.8 $ 43.3 Cash and investments segregated 20 % 13 % 38.2 33.7 21.7 25.9 31.8 Receivables from brokerage clients — net 24 % 15 % 85.4 74.0 72.8 71.2 68.7 Available for sale securities (23 )% (8 )% 83.0 90.0 93.6 101.1 107.6 Held to maturity securities (8 )% (2 )% 146.5 149.9 153.2 156.4 159.5 Bank loans — net 12 % 4 % 45.2 43.3 42.2 40.8 40.4 Total assets (3 )% 3 % 479.8 466.1 449.7 468.8 493.2 Bank deposits (11 )% 5 % 259.1 246.5 252.4 269.5 290.0 Payables to brokers, dealers, and clearing organizations (5) 102 % (19 )% 13.3 16.4 5.9 6.7 6.6 Payables to brokerage clients 20 % 14 % 101.6 89.2 80.0 84.0 84.8 Other short-term borrowings (9 )% (43 )% 6.0 10.6 10.0 8.4 6.6 Federal Home Loan Bank borrowings (37 )% (26 )% 16.7 22.6 24.4 24.0 26.4 Long-term debt (14 )% — 22.4 22.4 22.4 22.9 26.1 Stockholders’ equity 18 % 3 % 48.4 47.2 44.0 42.4 41.0 Other Full-time equivalent employees (at quarter end, in thousands) (3 )% — 32.1 32.1 32.3 32.6 33.0 Capital expenditures — purchases of equipment, office facilities, and property, net (in millions) 30 % 91 % $ 258 $ 135 $ 92 $ 122 $ 199 Expenses excluding interest as a percentage of average client assets (annualized) 0.12 % 0.12 % 0.13 % 0.14 % 0.16 % Clients’ Daily Average Trades (DATs) (in thousands) 22 % 11 % 6,312 5,697 5,486 5,958 5,192 Number of Trading Days 1 % (1 )% 63.0 63.5 63.0 61.0 62.5 Revenue Per Trade (6) (7 )% — $ 2.20 $ 2.20 $ 2.25 $ 2.25 $ 2.36 (1) Fourth quarter of 2023 includes $16 million in restructuring costs. (2) Fourth quarter of 2023 includes $181 million in restructuring costs. (3) The Company has voting and nonvoting common stock outstanding. As the participation rights, including dividend and liquidation rights, are identical between the voting and nonvoting stock classes, basic and diluted earnings per share are the same for each class. (4) Return on average common stockholders’ equity is calculated using net income available to common stockholders divided by average common stockholders’ equity. (5) Payables to brokers, dealers, and clearing organizations include securities loaned. (6) Revenue per trade is calculated as trading revenue divided by the product of DATs multiplied by the number of trading days. N/M Not meaningful. Percentage changes greater than 200% are presented as not meaningful. THE CHARLES SCHWAB CORPORATION Net Interest Revenue Information (In millions, except ratios or as noted) (Unaudited) Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Average Balance Interest Revenue/ Expense Average Yield/ Rate Average Balance Interest Revenue/ Expense Average Yield/ Rate Average Balance Interest Revenue/ Expense Average Yield/ Rate Average Balance Interest Revenue/ Expense Average Yield/ Rate Interest-earning assets Cash and cash equivalents $ 28,332 $ 334 4.61 % $ 35,312 $ 475 5.27 % $ 29,676 $ 1,539 5.10 % $ 37,846 $ 1,894 4.94 % Cash and investments segregated 36,510 429 4.60 % 23,830 314 5.16 % 28,450 1,443 4.99 % 28,259 1,355 4.73 % Receivables from brokerage clients 77,524 1,378 6.95 % 62,602 1,260 7.88 % 70,811 5,420 7.53 % 61,914 4,793 7.64 % Available for sale securities (1) 92,216 486 2.09 % 118,831 647 2.16 % 101,659 2,166 2.12 % 137,178 2,987 2.17 % Held to maturity securities (1) 147,608 638 1.72 % 160,378 700 1.74 % 152,566 2,636 1.72 % 165,634 2,872 1.73 % Bank loans 44,248 483 4.36 % 40,386 437 4.31 % 42,255 1,867 4.42 % 40,234 1,664 4.14 % Total interest-earning assets 426,438 3,748 3.46 % 441,339 3,833 3.43 % 425,417 15,071 3.51 % 471,065 15,565 3.28 % Securities lending revenue 72 78 330 419 Other interest revenue 31 52 136 127 Total interest-earning assets $ 426,438 $ 3,851 3.56 % $ 441,339 $ 3,963 3.54 % $ 425,417 $ 15,537 3.61 % $ 471,065 $ 16,111 3.39 % Funding sources Bank deposits $ 244,176 $ 550 0.90 % $ 280,380 $ 971 1.37 % $ 256,212 $ 3,152 1.23 % $ 306,505 $ 3,363 1.10 % Payables to brokers, dealers, and clearing organizations (2) 13,045 142 4.28 % 5,386 51 3.72 % 8,522 372 4.30 % 4,477 147 3.23 % Payables to brokerage clients 82,279 43 0.21 % 61,781 66 0.43 % 72,776 272 0.37 % 66,842 271 0.41 % Other short-term borrowings 9,094 122 5.33 % 6,724 95 5.63 % 9,146 504 5.51 % 7,144 375 5.25 % Federal Home Loan Bank borrowings 19,392 257 5.18 % 31,630 423 5.28 % 23,102 1,245 5.32 % 34,821 1,810 5.14 % Long-term debt 22,438 206 3.67 % 25,457 226 3.54 % 23,083 846 3.66 % 22,636 715 3.16 % Total interest-bearing liabilities (2) 390,424 1,320 1.34 % 411,358 1,832 1.77 % 392,841 6,391 1.62 % 442,425 6,681 1.51 % Non-interest-bearing funding sources (2) 36,014 29,981 32,576 28,640 Other interest expense — 1 2 3 Total funding sources $ 426,438 $ 1,320 1.23 % $ 441,339 $ 1,833 1.65 % $ 425,417 $ 6,393 1.49 % $ 471,065 $ 6,684 1.41 % Net interest revenue $ 2,531 2.33 % $ 2,130 1.89 % $ 9,144 2.12 % $ 9,427 1.98 % (1) Amounts have been calculated based on amortized cost. (2) Beginning in 2024, payables to brokers, dealers, and clearing organizations is presented separately from non-interest-bearing funding sources and included in total interest-bearing liabilities. This line item includes securities loaned and related interest expense. Prior period amounts have been reclassified to reflect this change. THE CHARLES SCHWAB CORPORATION Asset Management and Administration Fees Information (In millions, except ratios or as noted) (Unaudited) Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Average Client Assets Revenue Average Fee Average Client Assets Revenue Average Fee Average Client Assets Revenue Average Fee Average Client Assets Revenue Average Fee Schwab money market funds $ 580,957 $ 389 0.27 % $ 461,091 $ 299 0.26 % $ 539,113 $ 1,461 0.27 % $ 391,864 $ 1,034 0.26 % Schwab equity and bond funds, exchange-traded funds (ETFs), and collective trust funds (CTFs) 647,170 125 0.08 % 486,340 98 0.08 % 588,999 462 0.08 % 471,832 382 0.08 % Mutual Fund OneSource® and other no-transaction- fee funds 363,024 231 0.25 % 289,841 188 0.26 % 342,615 878 0.26 % 249,131 657 0.26 % Other third-party mutual funds and ETFs 629,913 106 0.07 % 572,027 97 0.07 % 611,999 420 0.07 % 640,689 490 0.08 % Total mutual funds, ETFs, and CTFs (1) $ 2,221,064 $ 851 0.15 % $ 1,809,299 $ 682 0.15 % $ 2,082,726 $ 3,221 0.15 % $ 1,753,516 $ 2,563 0.15 % Managed investing solutions (1) Fee-based $ 582,464 $ 557 0.38 % $ 465,266 $ 475 0.41 % $ 542,253 $ 2,129 0.39 % $ 458,114 $ 1,868 0.41 % Non-fee-based 115,712 — — 98,679 — — 111,571 — — 96,633 — — Total managed investing solutions $ 698,176 $ 557 0.32 % $ 563,945 $ 475 0.33 % $ 653,824 $ 2,129 0.33 % $ 554,747 $ 1,868 0.34 % Other balance-based fees (2) 827,930 76 0.04 % 664,774 65 0.04 % 776,715 286 0.04 % 608,170 254 0.04 % Other (3) 25 19 80 71 Total asset management and administration fees $ 1,509 $ 1,241 $ 5,716 $ 4,756 (1) Managed investing solutions, formerly referred to as “Advice solutions”, includes managed portfolios, specialized strategies, and customized investment advice such as Schwab Wealth Advisory™, Schwab Managed Portfolios™, Managed Account Select®, Schwab Advisor Network®, Windhaven Strategies®, ThomasPartners® Strategies, Wasmer Schroeder™ Strategies, Schwab Index Advantage advised retirement plan balances, Schwab Intelligent Portfolios®, Institutional Intelligent Portfolios®, Schwab Intelligent Portfolios Premium®, AdvisorDirect®, Essential Portfolios, Selective Portfolios, and Personalized Portfolios; as well as legacy non-fee managed investing solutions including Schwab Advisor Source and certain retirement plan balances. Average client assets for managed investing solutions may also include the asset balances contained in the mutual fund and/or ETF categories listed above. For the total end of period view, please see the Monthly Activity Report. (2) Includes various asset-related fees, such as trust fees, 401(k) recordkeeping fees, and mutual fund clearing fees and other service fees. (3) Includes miscellaneous service and transaction fees relating to mutual funds and ETFs that are not balance-based. THE CHARLES SCHWAB CORPORATION Growth in Client Assets and Accounts (Unaudited) Q4-24 % Change 2024 2023 vs. vs. Fourth Third Second First Fourth (In billions, at quarter end, except as noted) Q4-23 Q3-24 Quarter Quarter Quarter Quarter Quarter Assets in client accounts Schwab One®, certain cash equivalents, and bank deposits (3 )% 7 % $ 358.8 $ 334.1 $ 330.7 $ 348.2 $ 368.3 Bank deposit account balances (10 )% 4 % 87.5 84.0 84.5 90.2 97.4 Proprietary mutual funds (Schwab Funds® and Laudus Funds®) and CTFs Money market funds (1) 25 % 6 % 596.5 562.1 533.6 515.7 476.4 Equity and bond funds and CTFs (2) 24 % 1 % 232.2 228.9 214.4 206.0 186.7 Total proprietary mutual funds and CTFs 25 % 5 % 828.7 791.0 748.0 721.7 663.1 Mutual Fund Marketplace® (3) Mutual Fund OneSource® and other no-transaction-fee funds 14 % (3 )% 347.8 358.0 344.8 329.2 306.2 Mutual fund clearing services 20 % — 280.7 280.8 264.7 248.1 233.4 Other third-party mutual funds 8 % (2 )% 1,211.1 1,236.5 1,177.5 1,182.9 1,126.5 Total Mutual Fund Marketplace 10 % (2 )% 1,839.6 1,875.3 1,787.0 1,760.2 1,666.1 Total mutual fund assets 15 % — 2,668.3 2,666.3 2,535.0 2,481.9 2,329.2 Exchange-traded funds Proprietary ETFs (2) 24 % 2 % 395.0 385.9 349.6 342.9 319.4 Other third-party ETFs 28 % 3 % 1,940.6 1,888.2 1,738.6 1,676.6 1,521.7 Total ETF assets 27 % 3 % 2,335.6 2,274.1 2,088.2 2,019.5 1,841.1 Equity and other securities 26 % 3 % 3,972.6 3,839.6 3,648.8 3,467.7 3,163.5 Fixed income securities (2 )% (4 )% 762.3 795.4 792.0 779.0 779.7 Margin loans outstanding 34 % 15 % (83.8 ) (73.0 ) (71.7 ) (68.1 ) (62.6 ) Total client assets 19 % 2 % $ 10,101.3 $ 9,920.5 $ 9,407.5 $ 9,118.4 $ 8,516.6 Client assets by business (4) Investor Services (5) 20 % 3 % $ 5,721.6 $ 5,576.7 $ 5,317.5 $ 5,108.9 $ 4,759.2 Advisor Services (6) 17 % 1 % 4,379.7 4,343.8 4,090.0 4,009.5 3,757.4 Total client assets 19 % 2 % $ 10,101.3 $ 9,920.5 $ 9,407.5 $ 9,118.4 $ 8,516.6 Net growth in assets in client accounts (for the quarter ended) Net new assets by business (4) Investor Services (5) 64 % 24 % $ 46.2 $ 37.2 $ 40.1 $ 37.6 $ 28.1 Advisor Services (6) 63 % 16 % 62.2 53.6 34.1 50.6 38.2 Total net new assets 63 % 19 % $ 108.4 $ 90.8 $ 74.2 $ 88.2 $ 66.3 Net market gains 72.4 422.2 214.9 513.6 625.8 Net growth $ 180.8 $ 513.0 $ 289.1 $ 601.8 $ 692.1 New brokerage accounts (in thousands, for the quarter ended) 23 % 15 % 1,119 972 985 1,094 910 Client accounts (in thousands) Active brokerage accounts 5 % 1 % 36,456 35,982 35,612 35,301 34,838 Banking accounts 9 % 2 % 1,998 1,954 1,931 1,885 1,838 Workplace Plan Participant Accounts (7) 3 % — 5,399 5,388 5,363 5,277 5,221 (1) Total client assets in purchased money market funds are located at: https://www.aboutschwab.com/investor-relations. (2) Includes balances held on and off the Schwab platform. As of December 31, 2024, off-platform equity and bond funds, CTFs, and ETFs were $35.0 billion, $3.9 billion, and $139.0 billion, respectively. (3) Excludes all proprietary mutual funds and ETFs. (4) In the fourth quarter of 2024, Retirement Business Services moved from Advisor Services to Investor Services. Prior periods have been recast. (5) Fourth quarter of 2024 includes net outflows of $5.5 billion from off-platform Schwab Bank Retail CDs and an outflow of $0.6 billion from a large international relationship. Third quarter of 2024 includes net outflows of $4.4 billion from off-platform Schwab Bank Retail CDs and an outflow of $0.1 billion from a large international relationship. Second quarter of 2024 includes net inflows of $2.7 billion from off-platform Schwab Bank Retail CDs and an inflow of $10.3 billion from a mutual fund clearing services client. First quarter of 2024 includes net outflows of $7.4 billion from off-platform Schwab Bank Retail CDs. Fourth quarter of 2023 includes net inflows of $2.4 billion from off-platform Schwab Bank Retail CDs and outflows of $5.8 billion from a large international relationship. (6) Fourth quarter of 2024 includes an outflow of $0.3 billion from a large international relationship. Fourth quarter of 2023 includes outflows of $6.4 billion from a large international relationship. (7) Includes Retirement Plan Services, Stock Plan Services, Designated Brokerage Services, and Retirement Business Services. Participants may be enrolled in services in more than one Workplace business. The Charles Schwab Corporation Monthly Activity Report For December 2024 2023 2024 Change Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Mo. Yr. Market Indices (at month end) Dow Jones Industrial Average® 37,690 38,150 38,996 39,807 37,816 38,686 39,119 40,843 41,563 42,330 41,763 44,911 42,544 (5 )% 13 % Nasdaq Composite® 15,011 15,164 16,092 16,379 15,658 16,735 17,733 17,599 17,714 18,189 18,095 19,218 19,311 — 29 % Standard & Poor’s® 500 4,770 4,846 5,096 5,254 5,036 5,278 5,460 5,522 5,648 5,762 5,705 6,032 5,882 (2 )% 23 % Client Assets (in billions of dollars) Beginning Client Assets 8,180.6 8,516.6 8,558.1 8,879.5 9,118.4 8,847.5 9,206.3 9,407.5 9,572.1 9,737.7 9,920.5 9,852.0 10,305.4 Net New Assets (1) 42.1 14.8 31.7 41.7 10.0 31.0 33.2 29.0 31.5 30.3 22.7 25.5 60.2 136 % 43 % Net Market Gains (Losses) 293.9 26.7 289.7 197.2 (280.9 ) 327.8 168.0 135.6 134.1 152.5 (91.2 ) 427.9 (264.3 ) Total Client Assets (at month end) 8,516.6 8,558.1 8,879.5 9,118.4 8,847.5 9,206.3 9,407.5 9,572.1 9,737.7 9,920.5 9,852.0 10,305.4 10,101.3 (2 )% 19 % Core Net New Assets (1,2) 43.1 17.2 33.4 45.0 1.0 31.1 29.1 29.0 32.8 33.5 24.6 28.8 61.4 113 % 42 % Receiving Ongoing Advisory Services (at month end) Investor Services 581.4 584.1 601.8 618.5 602.2 624.0 632.9 649.1 663.7 675.1 665.6 688.9 682.0 (1 )% 17 % Advisor Services 3,757.4 3,780.4 3,902.5 4,009.5 3,893.9 4,027.3 4,090.0 4,185.4 4,268.1 4,343.8 4,303.3 4,489.2 4,379.7 (2 )% 17 % Client Accounts (at month end, in thousands) Active Brokerage Accounts 34,838 35,017 35,127 35,301 35,426 35,524 35,612 35,743 35,859 35,982 36,073 36,222 36,456 1 % 5 % Banking Accounts 1,838 1,856 1,871 1,885 1,901 1,916 1,931 1,937 1,940 1,954 1,967 1,980 1,998 1 % 9 % Workplace Plan Participant Accounts (3) 5,221 5,226 5,268 5,277 5,282 5,345 5,363 5,382 5,373 5,388 5,407 5,393 5,399 — 3 % Client Activity New Brokerage Accounts (in thousands) 340 366 345 383 361 314 310 327 324 321 331 357 431 21 % 27 % Client Cash as a Percentage of Client Assets (4) 10.5 % 10.5 % 10.2 % 10.0 % 10.2 % 9.9 % 9.7 % 9.6 % 9.5 % 9.5 % 9.8 % 9.5 % 10.1 % 60 bp (40) bp Derivative Trades as a Percentage of Total Trades 21.8 % 21.8 % 22.2 % 21.9 % 22.1 % 21.9 % 21.3 % 21.2 % 20.8 % 21.5 % 21.4 % 19.7 % 18.6 % (110) bp (320) bp Selected Average Balances (in millions of dollars) Average Interest-Earning Assets (5) 446,305 443,694 434,822 431,456 423,532 415,950 417,150 417,379 420,191 420,203 422,327 425,789 431,177 1 % (3 )% Average Margin Balances 62,309 61,368 63,600 66,425 68,827 67,614 69,730 73,206 73,326 72,755 74,105 76,932 81,507 6 % 31 % Average Bank Deposit Account Balances (6) 95,518 95,553 92,075 90,774 88,819 86,844 85,195 83,979 82,806 82,336 83,261 84,385 85,384 1 % (11 )% Mutual Fund and Exchange-Traded Fund Net Buys (Sells) (7,8) (in millions of dollars) Equities 7,903 8,182 7,624 10,379 3,472 5,734 3,379 10,908 5,609 5,217 7,176 13,226 14,805 Hybrid (1,596 ) (501 ) (1,330 ) (439 ) (703 ) (558 ) (843 ) (1,155 ) (1,377 ) (432 ) (1,397 ) (329 ) 124 Bonds 6,104 7,510 9,883 7,561 5,949 5,854 6,346 8,651 10,919 11,015 10,442 7,473 10,969 Net Buy (Sell) Activity (in millions of dollars) Mutual Funds (7) (7,406 ) (966 ) (1,348 ) (1,607 ) (4,818 ) (5,544 ) (4,254 ) (4,679 ) (4,003 ) (1,261 ) (4,905 ) (4,492 ) (4,331 ) Exchange-Traded Funds (8) 19,817 16,157 17,525 19,108 13,536 16,574 13,136 23,083 19,154 17,061 21,126 24,862 30,229 Money Market Funds 7,745 11,717 10,129 9,085 (2,357 ) 9,790 3,858 9,110 8,048 9,672 11,032 9,172 8,956 Note: Certain supplemental details related to the information above can be found at: https://www.aboutschwab.com/financial-reports. (1) Unless otherwise noted, differences between net new assets and core net new assets are net flows from off-platform Schwab Bank Retail CDs. Additionally, 2024 includes outflows from a large international relationship of $0.1 billion in August, $0.3 billion in October, $0.6 billion in November, and an inflow of $10.3 billion from a mutual fund clearing services client in April. 2023 also includes an outflow from a large international relationship of $0.6 billion in December. (2) Net new assets before significant one-time inflows or outflows, such as acquisitions/divestitures or extraordinary flows (generally greater than $10 billion) relating to a specific client, and activity from off-platform Schwab Bank Retail CDs. These flows may span multiple reporting periods. (3) Includes Retirement Plan Services, Stock Plan Services, Designated Brokerage Services, and Retirement Business Services. Participants may be enrolled in services in more than one Workplace business. (4) Schwab One®, certain cash equivalents, bank deposits, third-party bank deposit accounts, and money market fund balances as a percentage of total client assets; client cash excludes brokered CDs issued by Charles Schwab Bank. (5) Represents average total interest-earning assets on the Company’s balance sheet. (6) Represents average clients’ uninvested cash sweep account balances held in deposit accounts at third-party financial institutions. (7) Represents the principal value of client mutual fund transactions handled by Schwab, including transactions in proprietary funds. Includes institutional funds available only to Investment Managers. Excludes money market fund transactions. (8) Represents the principal value of client ETF transactions handled by Schwab, including transactions in proprietary ETFs. THE CHARLES SCHWAB CORPORATION Non-GAAP Financial Measures (In millions, except ratios and per share amounts) (Unaudited) In addition to disclosing financial results in accordance with generally accepted accounting principles in the U.S. (GAAP), Schwab’s fourth quarter earnings release contains references to the non-GAAP financial measures described below. We believe these non-GAAP financial measures provide useful supplemental information about the financial performance of the Company, and facilitate meaningful comparison of Schwab’s results in the current period to both historic and future results. These non-GAAP measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may not be comparable to non-GAAP financial measures presented by other companies. Schwab’s use of non-GAAP measures is reflective of certain adjustments made to GAAP financial measures as described below. Beginning in the third quarter of 2023, these adjustments also include restructuring costs, which the Company began incurring in connection with its previously announced plans to streamline its operations to prepare for post-integration of Ameritrade. See Part I – Item 1 – Note 10 of our Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 for additional information. Non-GAAP Adjustment or Measure Definition Usefulness to Investors and Uses by Management Acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs Schwab adjusts certain GAAP financial measures to exclude the impact of acquisition and integration-related costs incurred as a result of the Company’s acquisitions, amortization of acquired intangible assets, restructuring costs, and, where applicable, the income tax effect of these expenses. Adjustments made to exclude amortization of acquired intangible assets are reflective of all acquired intangible assets, which were recorded as part of purchase accounting. These acquired intangible assets contribute to the Company’s revenue generation. Amortization of acquired intangible assets will continue in future periods over their remaining useful lives. We exclude acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs for the purpose of calculating certain non-GAAP measures because we believe doing so provides additional transparency of Schwab’s ongoing operations, and is useful in both evaluating the operating performance of the business and facilitating comparison of results with prior and future periods. Costs related to acquisition and integration or restructuring fluctuate based on the timing of acquisitions, integration and restructuring activities, thereby limiting comparability of results among periods, and are not representative of the costs of running the Company’s ongoing business. Amortization of acquired intangible assets is excluded because management does not believe it is indicative of the Company’s underlying operating performance. Return on tangible common equity Return on tangible common equity represents annualized adjusted net income available to common stockholders as a percentage of average tangible common equity. Tangible common equity represents common equity less goodwill, acquired intangible assets — net, and related deferred tax liabilities. Acquisitions typically result in the recognition of significant amounts of goodwill and acquired intangible assets. We believe return on tangible common equity may be useful to investors as a supplemental measure to facilitate assessing capital efficiency and returns relative to the composition of Schwab’s balance sheet. Adjusted Tier 1 Leverage Ratio Adjusted Tier 1 Leverage Ratio represents the Tier 1 Leverage Ratio as prescribed by bank regulatory guidance for the consolidated company and for Charles Schwab Bank, SSB (CSB), adjusted to reflect the inclusion of accumulated other comprehensive income (AOCI) in the ratio. Inclusion of the impacts of AOCI in the Company’s Tier 1 Leverage Ratio provides additional information regarding the Company’s current capital position. We believe Adjusted Tier 1 Leverage Ratio may be useful to investors as a supplemental measure of the Company’s capital levels. The Company also uses adjusted diluted EPS and return on tangible common equity as components of performance criteria for employee bonus and certain executive management incentive compensation arrangements. The Compensation Committee of CSC’s Board of Directors maintains discretion in evaluating performance against these criteria. Additionally, the Company uses adjusted Tier 1 Leverage Ratio in managing capital, including its use of the measure as its long-term operating objective. The tables below present reconciliations of GAAP measures to non-GAAP measures: Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Total Expenses Excluding Interest Net Income Total Expenses Excluding Interest Net Income Total Expenses Excluding Interest Net Income Total Expenses Excluding Interest Net Income Total expenses excluding interest (GAAP), Net income (GAAP) $ 3,024 $ 1,840 $ 3,265 $ 1,045 $ 11,914 $ 5,942 $ 12,459 $ 5,067 Acquisition and integration-related costs (1) (20 ) 20 (67 ) 67 (117 ) 117 (401 ) 401 Amortization of acquired intangible assets (130 ) 130 (130 ) 130 (519 ) 519 (534 ) 534 Restructuring costs (2) (27 ) 27 (216 ) 216 (9 ) 9 (495 ) 495 Income tax effects (3) N/A (43 ) N/A (91 ) N/A (154 ) N/A (338 ) Adjusted total expenses (non-GAAP), Adjusted net income (non-GAAP) $ 2,847 $ 1,974 $ 2,852 $ 1,367 $ 11,269 $ 6,433 $ 11,029 $ 6,159 (1) Acquisition and integration-related costs for the three and twelve months ended December 31, 2024 primarily consist of $10 million and $54 million of compensation and benefits, $4 million and $36 million of professional services, and $6 million and $19 million of depreciation and amortization. Acquisition and integration-related costs for the three and twelve months ended December 31, 2023 primarily consist of $29 million and $187 million of compensation and benefits, $24 million and $135 million of professional services, $7 million and $28 million of occupancy and equipment, and $1 million and $27 million of other expense. (2) Restructuring costs for the three months ended December 31, 2024 primarily consist of $24 million of other expense. Restructuring costs for the twelve months ended December 31, 2024 reflect a change in estimate of $34 million in compensation and benefits, offset by $5 million of occupancy and equipment and $37 million of other expense. Restructuring costs for the three and twelve months ended December 31, 2023 primarily consist of $16 million and $292 million of compensation and benefits, $15 million and $17 million of occupancy and equipment, and $181 million of other expense for each period. (3) The income tax effects of the non-GAAP adjustments are determined using an effective tax rate reflecting the exclusion of non-deductible acquisition costs and are used to present the acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs on an after-tax basis. N/A Not applicable. Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Amount % of Total Net Revenues Amount % of Total Net Revenues Amount % of Total Net Revenues Amount % of Total Net Revenues Income before taxes on income (GAAP), Pre-tax profit margin (GAAP) $ 2,305 43.3 % $ 1,194 26.8 % $ 7,692 39.2 % $ 6,378 33.9 % Acquisition and integration-related costs 20 0.4 % 67 1.5 % 117 0.6 % 401 2.1 % Amortization of acquired intangible assets 130 2.4 % 130 2.9 % 519 2.7 % 534 2.9 % Restructuring costs 27 0.5 % 216 4.8 % 9 — 495 2.6 % Adjusted income before taxes on income (non-GAAP), Adjusted pre-tax profit margin (non-GAAP) $ 2,482 46.6 % $ 1,607 36.0 % $ 8,337 42.5 % $ 7,808 41.5 % Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Amount Diluted EPS Amount Diluted EPS Amount Diluted EPS Amount Diluted EPS Net income available to common stockholders (GAAP), Earnings per common share — diluted (GAAP) $ 1,717 $ .94 $ 926 $ .51 $ 5,478 $ 2.99 $ 4,649 $ 2.54 Acquisition and integration-related costs 20 .01 67 .04 117 .06 401 .22 Amortization of acquired intangible assets 130 .07 130 .07 519 .28 534 .29 Restructuring costs 27 .01 216 .12 9 — 495 .27 Income tax effects (43 ) (.02 ) (91 ) (.06 ) (154 ) (.08 ) (338 ) (.19 ) Adjusted net income available to common stockholders (non-GAAP), Adjusted diluted EPS (non-GAAP) $ 1,851 $ 1.01 $ 1,248 $ .68 $ 5,969 $ 3.25 $ 5,741 $ 3.13 Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Return on average common stockholders’ equity (GAAP) 18 % 12 % 15 % 16 % Average common stockholders’ equity $ 38,604 $ 30,179 $ 35,475 $ 29,334 Less: Average goodwill (11,951 ) (11,951 ) (11,951 ) (11,951 ) Less: Average acquired intangible assets — net (7,808 ) (8,325 ) (8,002 ) (8,524 ) Plus: Average deferred tax liabilities related to goodwill and acquired intangible assets — net 1,723 1,790 1,741 1,805 Average tangible common equity $ 20,568 $ 11,693 $ 17,263 $ 10,664 Adjusted net income available to common stockholders (1) $ 1,851 $ 1,248 $ 5,969 $ 5,741 Return on tangible common equity (non-GAAP) 36 % 43 % 35 % 54 % (1) See table above for the reconciliation of net income available to common stockholders to adjusted net income available to common stockholders (non-GAAP). (Preliminary) December 31, 2024 CSC CSB Tier 1 Leverage Ratio (GAAP) 9.9 % 11.6 % Tier 1 Capital $ 45,186 $ 32,584 Plus: AOCI adjustment (14,839 ) (12,938 ) Adjusted Tier 1 Capital 30,347 19,646 Average assets with regulatory adjustments 458,119 280,701 Plus: AOCI adjustment (14,831 ) (13,037 ) Adjusted average assets with regulatory adjustments $ 443,288 $ 267,664 Adjusted Tier 1 Leverage Ratio (non-GAAP) 6.8 % 7.3 %

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