- Key insights: JPMorgan Payments logged record revenues of $4.9 billion in the third quarter, a 14% year-over-year increase. Excluding the impact of equity investments, payments revenue rose 6%.
- What's at stake: JPMorganChase CEO Jamie Dimon warned that the economy was softening during the bank's quarterly call with analysts on Tuesday.
- Forward look: Piper Sandler analysts said that the revenue outlook for the wider bank "remains very strong."
JPMorgan Payments, a division within the bank's commercial and investment bank, posted record revenue in the third quarter as it made further inroads in merchant services and supply chain finance.
Revenue hit $4.9 billion in Q3, a 14% year-over-year increase. Excluding the impact of equity investments, payments revenue rose 6% year over year.
"Our team's commitment to delivering outstanding client experiences is the reason behind our continued success. We remain focused on delivering next-gen solutions to help our clients grow their business while continuing to provide the stability and resiliency that differentiates us from competitors," Umar Farooq, Global Co-Head of J.P. Morgan Payments, told American Banker.
The nearly $5 billion in revenue generated by JPMorgan Payments accounted for more than half of the $9.5 billion of banking and payments revenue during the quarter.
JPMorganChase executives maintained an optimistic outlook for future revenue growth for its fee-generating lines of business, including payments division, during the call with investors, Truist Securities analyst John McDonald wrote in a research note.
Looking ahead, Piper Sandler analysts said that the revenue outlook for the wider bank "remains very strong," even as CEO Jamie Dimon warned of a softening economy.
"To round out the revenue discussion, both [investment banking] and Markets revenues … beat our estimates in the 3Q, and JPM's scaled businesses here suggest that the company is in an excellent position to continue to capture industry momentum," Piper Sandler analysts said.
Beyond the numbers
Revenue in the bank's payment division reached several milestones during the three months ending Sept. 30, the bank said.
First, transaction volume in merchant services reached $2 trillion, 20 days earlier than it did in 2024.
JPMorgan Payments also unveiled a supply chain finance solution that it integrated with Oracle's cloud-based enterprise resource planning product that was adopted by FedEx.
JPMorgan's solution provides FedEx with the working capital flexibility while also allowing vendors the option to receive payment early.
For example, when FedEx approves an invoice, vendors can wait for payment on extended terms or receive early payment from JPMorgan Payments at financing rates based on FedEx's credit rating, according to the bank.
"Collaborating with J.P. Morgan Payments and Oracle to build a solution has been transformative for our working capital management," said Trampas Gunter, CVP corporate development and treasurer at FedEx, in a statement. "Leveraging J.P. Morgan Payments' SCF and liquidity solutions in a way that is tailored to our business has strengthened our financial position and enhanced our operational resilience, ultimately benefiting our customers and shareholders."
