It has been about a month since the last earnings report for JPMorgan Chase & Co. (JPM). Shares have added about 1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is JPMorgan Chase & Co. due for a pullback? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for JPMorgan Chase & Co. before we dive into how investors and analysts have reacted as of late.
JPMorgan's Q4 Earnings Beat Estimates on Solid Trading & NII, Weak IB Hurts
Impressive trading performance and higher NII drove JPMorgan’s adjusted fourth-quarter 2025 earnings of $5.23 per share. The bottom line handily surpassed the Zacks Consensus Estimate of $5.01.
Markets revenues were impressive and exceeded management's expectations of growth in the low-teens percentage rate. The metric soared 17% to $8.2 billion. Specifically, fixed-income markets revenues rose 7% to $5.38 billion, while equity markets revenues jumped 40% to $2.86 billion.
However, the IB business performance was weaker than expected by management. Advisory fees declined 3%, while debt and equity underwriting fees fell 16% and 2%, respectively. Thus, total IB fees (in the CIB segment) were down 5% from the prior-year quarter to $2.35 billion. The company had projected IB fees to be up in the low single digits during the quarter.
The company recorded an increase in NII, driven by higher yields and 11% year-over-year jump in total loans. Among other positives, CCB average loan balances were up 1% year over year. Also, debit and credit card sales volume increased 7%. On the other hand, mortgage fees and related income fell 5% to $357 million.
During the quarter, operating expenses rose. Also, provisions increased during the quarter.
Revenues Rise, Expenses Up
Net revenues, as reported, were $45.79 billion, up 7% year over year. The top line outpaced the Zacks Consensus Estimate of $45.69 billion.
NII rose 7% year over year to $25 billion. Non-interest income also grew 7% to $20.8 billion.
Non-interest expenses (on a managed basis) were $23.98 billion, up 5% year over year. This was mainly due to higher compensation expenses, brokerage expense and distribution fees, marketing costs, occupancy expenses and auto lease depreciation, partly offset by the release of the FDIC special assessment accrual.
The performance of JPMorgan’s business segments, in terms of net income generation, was decent. The CIB and Asset & Wealth Management witnessed a rise in net income on a year-over-year basis. On the other hand, the CCB and Corporate segments recorded a fall in net income.
Results in the reported quarter excluded $2.2 billion of credit reserve established for the forward purchase commitment of the Apple credit card portfolio. After considering this, net income declined 7% to $13.03 billion.
Credit Quality Weak
Provision for credit losses was $4.66 billion, soaring 77% from the prior-year quarter. This included the above-mentioned provision for the Apple credit card portfolio.
Net charge-offs (NCOs) increased 5% to $2.51 billion. Also, as of Dec. 31, 2025, non-performing assets (NPAs) were $10.36 billion, surging 11%.
Capital Position Solid
Tier 1 capital ratio (estimated) was 15.5% at the fourth-quarter end, down from 16.8% in the prior-year quarter. Tier 1 common equity capital ratio (estimated) was 14.5%, down from 15.7%. Total capital ratio was 17.3% (estimated) compared with 18.5% a year ago.
Book value per share was $126.99 as of Dec. 31, 2025, compared with $116.07 a year ago. Tangible book value per common share was $107.56 at the end of December 2025, up from $97.30.
Update on Share Repurchases
During the reported quarter, JPMorgan repurchased 26.7 million shares for $7.9 billion.
2026 Outlook
Management expects NII to be almost $103 billion for this year, up 7.4% from $95.9 billion in 2025. Further, the company projects NII excluding Markets to be nearly $95 billion, driven by continued loan growth in Cards and modest deposit growth, partially offset by the impact of lower rates (assumes two rate cuts).
Card loan growth is anticipated to be 6-7%. The company expects modest deposit growth.
Management expects adjusted non-interest expense to be $105 billion for this year, up from $96 billion in 2025. The jump will likely be primarily due to an increase in growth and volume-related spending (like compensation costs, costs for branching/expansion and costs related to credit card business growth), along with an increase in expenses related to investments in technology and AI. Apart from these, structural inflation-related costs like higher real estate and general operating overhead expenses will result in a rise in overall firm-wide expenses.
Additionally, JPMorgan expects card service NCO rate to be roughly 3.4% “on favorable delinquency trends driven by the continued resilience of the consumer.”
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a flat trend in estimates review.
VGM Scores
Currently, JPMorgan Chase & Co. has a poor Growth Score of F, however its Momentum Score is doing a lot better with a B. However, the stock has a score of F on the value side, putting it in the bottom 20% quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
JPMorgan Chase & Co. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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JPMorgan Chase & Co. (JPM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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