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JPMorgan Chase (New York Stock Exchange: JPM) stock shot up 6% in premarket trading on Friday after the megabank raised its 2023 net interest income outlook and comfortably beat Wall Street’s first-quarter earnings and revenue expectations with higher interest rates serving as a boon. .
“The US economy. continues on a generally healthy footing: consumers are still spending and have strong balance sheets, and businesses are in good shape,” said CEO Jamie Dimon. “However, the storm clouds we have been monitoring for the past year remain on the horizon, and turmoil in the banking industry adds to these risks.”
For the full year, JPMorgan (JPM) now expects total net interest income of ~$81 billion compared to ~$73 billion in the previous forecast. Excluding CIB markets, he anticipates a FY23 NII of ~$81bn vs. previous target of ~$74bn.
Adjusted spending for 2023 is still expected to be ~$81 billion.
First-quarter EPS of $4.10, beating analysts’ median estimate of $3.41, increased from $3.57 in the fourth quarter and from $2.63 in the year-ago quarter.
Adjusted revenue of $39.34 billion, beating consensus of $35.77 billion, was up from $34.55 billion in the prior quarter and from $30.72 billion in the first quarter of 2022.
First quarter non-interest expenses were $20.11 billion, up from $19.02 billion in the fourth quarter and $19.19 billion in the first quarter of 2022, driven by higher structural expenses and investments in business (ie, compensation that reflects headcount growth and salary inflation).
The provision for credit losses was $2.28 billion compared to $2.29 billion in the fourth quarter and $1.46 billion a year earlier, given an increased likelihood of a mild recession due to tightening financial conditions.
Net interest income of $20.7 billion vs. $18.8 billion consensus visible alpha, $20.2 billion in Q4 and $13.9 billion in Q1 2022.
Total first-quarter non-interest income of $17.6 billion versus $14.4 billion in the fourth quarter and $16.8 billion in the prior-year period.
Total first quarter loans of $1.13 trillion were virtually unchanged from the prior quarter; total deposits of $2.38T earned 1.6% Q/Q.
First Quarter Revenue and Net Income by Segment:
- Consumer and community banking revenues of $16.5 billion versus $15.8 billion in the prior quarter and $12.2 billion in the prior-year quarter; Net income of $5.24 billion increased from $4.56 billion in the fourth quarter and from $2.91 billion in the first quarter of 2022.
- Corporate and Investment Banking revenues of $13.6 billion advanced 28% qoq and 0.2% yoy; net income of $4.42B gained 33% Q/Q and 1.1% Y/Y.
- Commercial Banking revenues of $3.51 billion increased 3% qoq and 46% yoy; Net income of $1.35B fell 5% from Q4 and increased 58% from Q1 2022.
- Wealth and asset management revenue of $4.78 billion increased 4% QoQ and 11% YoY; net income of $1.37B increased 21% Q/Q and 36% Y/Y.
Conference call at 8:30 am ET
Previously, JPMorgan Chase GAAP EPS of $4.10 is up $0.69, revenue of $38.3B is up $2.53B.