Wells Fargo gets boost from markets and consumer businesses

• Key insight: The company continues to benefit from growth in loans, deposits and revenue in the wake of its release from a seven-year asset cap.
• Supporting data: The loan portfolio topped $1 trillion at the end of the first-quarter.
• Expert quote: Though consumers are paying higher prices for gas, spending activity "continues to be quite resilient and quite strong." — Chief Financial Officer Mike Santomassimo

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Wells Fargo reported first-quarter net income totaling $5.25 billion Tuesday, up 7% from the same period last year. Continued strong performance by the company's massive consumer banking business, along with a spike in markets revenue, powered the increase.

The $2.2 trillion-asset Wells Fargo reported diluted first-quarter earnings per share of $1.60. Analysts had expected the San Francisco-based company to report first quarter earnings per share of $1.58, according to S&P Capital IQ.

Wells Fargo benefitted from "continued resiliency in the underlying economy," despite macroeconomic headwinds, Chairman and CEO Charlie Scharf said in a press release.

"The financial health of the consumers and businesses we serve remains strong, though the impact of higher oil prices will likely take some time to materialize," Scharf said.

The war in the Middle East is "certainly is having an impact" on consumers' overall spending, Chief Financial Officer Mike Santomassimo said Tuesday on a conference call with reporters. Though consumers are paying more for gas, overall activity "continues to be quite resilient and quite strong."

"What we're seeing right now is quite a strong and resilient economy," Santomassimo added.

Revenue from Wells' consumer banking and lending activities totaled $10 billion for the three months ending March 31, up 7% year over year. The company reported solid year-over-year increases in credit and debit-card purchase volumes, while auto loan originations more than doubled to $9.7 billion.

Meanwhile, markets revenue, covering the equities and fixed-income, currencies and commodities businesses, jumped 19% from the first quarter of 2024 to $2.17 billion.

Company-wide revenue totaled $21.4 billion, up 6% from the first quarter of 2025.

"It was a really good solid start to the year," Santomassimo said on the conference call.

Net chargeoffs of $1.1 billion were 0.45% of average total loans, level with the first-quarter 2025 result. Nonaccrual loans totaled 0.83% of average total loans, down from 0.87% a year ago.

Wells Fargo reported loans of $1.02 trillion on March 31, up 11% year over year, and outpacing analysts' expectations, according to Keith Horowitz, who covers Wells Fargo for Citi.

That total included $210.2 billion in loans to financial institutions other than banks. Bank lending to so-called NDFI institutions has emerged as an area of concern among analysts and investors, but Santomassimo said Wells Fargo's portfolio remains sound.

"We're quite comfortable with the risks that we have in that portfolio," Santomassimo said.

First-quarter deposits of $1.45 trillion were up 6.8% from 2025.

Wells Fargo has been on an upward trajectory since June, when regulators lifted a $1.95 trillion asset cap they imposed in 2018, following the disclosure of a massive phony-accounts scandal.

The company ended 2025 on a high note, reporting a $5.4 billion fourth-quarter profit that represented a 5.5% increase over the comparable 2024 result. Full-year 2025 earnings of $21.3 billion were up roughly 7% over 2024.

In a research note last month, Jefferies analyst David Chiaverini initiated coverage of Wells with a "buy" rating and a $100-per-share price target. Shares in the company were trading down 5% on Tuesday morning at $82.15.

Chiaverini described Wells as "entering a period of meaningful balance sheet growth" following the lifting of the asset cap.

"Wells Fargo can deliver this accelerated growth without assuming the execution risk typically associated with geographic expansion or new product launches," given its nationwide footprint and comprehensive product set, Chiaverini wrote.