Wells Fargo (WFC) — Q3 2026 Earnings Preview
Key Factors to Watch This Quarter
| Factor | Details & Signals to Watch |
|---|---|
| Net Interest Income (NII) | Guidance is $50B ± for FY26; Q2 NII was $12.3B (+5% YoY). Watch for continued loan/deposit growth, NIM trends, and any update to full-year NII guidance. |
| Net Interest Margin (NIM) | Q2 NIM was 2.43% (down 25 bps YoY, -4 bps QoQ). Management expects modest compression in Q3, stabilizing in Q4. Monitor for stabilization or further pressure. |
| Loan Growth | Q2 avg loans +12% YoY; management expects full-year growth above original mid-single-digit guide. Watch for continued momentum, especially in C&I, card, and auto. |
| Deposit Growth & Mix | Q2 avg deposits +10% YoY, driven by interest-bearing commercial balances. Noninterest-bearing deposits now expected to be stable, not growing. Watch for mix shift and cost of deposits. |
| Fee Income | Q2 noninterest income +13% YoY, with strong investment banking, trading, and wealth fees. Look for sustainability of fee growth, especially as Markets NII grows. |
| Expense Discipline | FY26 expense guide unchanged at ~$55.7B. Q2 expenses +2% YoY, but non-revenue-related expenses declined. Watch for continued headcount reduction and efficiency gains. |
| Credit Quality | Q2 net charge-offs 0.34% (down 10 bps YoY). Credit remains benign; monitor for early signs of normalization or stress, especially in consumer and commercial portfolios. |
| ROTCE Trajectory | Q2 ROTCE 17.7% (vs. 15.2% YoY); management targets 17–18% medium-term. Watch for commentary on sustainability and timing. |
| Capital Return | CET1 at 10.3% (target 10–10.5%). $3B buybacks in Q2; dividend to increase 11% in Q3. Watch for pace of buybacks and any commentary on capital deployment post-Basel III finalization. |
| Markets Business | Markets revenue +24% YoY in Q2; asset growth expected to slow in H2. Watch for evidence of cross-sell from financing to trading/fees and impact on NIM/returns. |
Summary and Conclusions
- Wells Fargo enters Q3 2026 with strong momentum: Q2 results showed broad-based revenue growth (+9% YoY), double-digit loan and deposit growth, and ROTCE at the high end of management's medium-term target.
- Guidance for FY26 NII ($50B ±) and expenses ($55.7B) is unchanged. Management expects NIM to compress modestly in Q3 and stabilize in Q4, with loan growth likely exceeding original mid-single-digit expectations.
- Key investor focus areas: NII/NIM trajectory, sustainability of loan and deposit growth, fee income durability, expense control, credit quality, and ROTCE progression.
- Year-over-year comparables are challenging: Q3 2025 was a strong quarter, but Q2 2026 results suggest WFC is building on that strength rather than facing a tough comp-down scenario.
- Macro and regulatory context: The U.S. economy remains robust, credit quality is benign, and Wells Fargo is benefiting from the removal of the asset cap. Basel III finalization could free up additional capital, but management will not act until rules are finalized.
Quarterly Financial Snapshot — Actuals vs. Consensus
Quarterly Results: Actuals (Restated Where Available)
| Quarter | Revenue ($M) | Net Income ($M) | Diluted EPS | NII ($M) | Noninterest Income ($M) | ROTCE (%) | NIM (%) | Loans ($B) | Deposits ($B) | Efficiency Ratio (%) |
|---|---|---|---|---|---|---|---|---|---|---|
| Q2 2026 | 22,622 | 6,407 | 2.00 | 12,317 | 10,305 | 17.7 | 2.43 | 1,026.5 | 1,465.6 | 60 |
| Q1 2026 | 21,446 | 5,253 | 1.60 | 12,096 | 9,350 | 14.5 | 2.47 | 996.0 | 1,415.0 | 67 |
| Q4 2025 | 21,292 | 5,361 | 1.62 | 12,331 | 8,961 | 14.5 | 2.60 | 955.9 | 1,377.7 | 64 |
| Q3 2025 | 21,436 | 5,589 | 1.66 | 11,950 | 9,486 | 15.2 | 2.61 | 928.7 | 1,339.9 | 65 |
Quarterly Consensus Estimates (Forward)
| Quarter | Revenue ($M) | Net Income ($M) | EPS (GAAP) |
|---|---|---|---|
| Q3 2026E | 22,340 | 5,595 | 1.85 |
| Q4 2026E | 22,432 | 5,529 | 1.86 |
| Q1 2027E | 22,758 | 5,153 | 1.76 |
| Q2 2027E | 23,250 | 5,834 | 2.03 |
Year-Ago Comparison: Q3 2025 Actuals
| Metric | Q3 2025 Actual | YoY Change vs. Q3 2024 |
|---|---|---|
| Revenue ($M) | 21,436 | +5% |
| Net Income ($M) | 5,589 | +9% |
| Diluted EPS | 1.66 | +17% |
| NII ($M) | 11,950 | +2% |
| Noninterest Income ($M) | 9,486 | +9% |
| ROTCE (%) | 15.2 | +130 bps |
| NIM (%) | 2.61 | -6 bps |
| Loans ($B) | 928.7 | +2% |
| Deposits ($B) | 1,339.9 | flat |
| Efficiency Ratio (%) | 65 | +1 pt |
Conclusion: Q3 2025 was a strong quarter with solid revenue and earnings growth, but Q2 2026 results show even stronger momentum, suggesting Q3 2026 is not facing an unusually tough comparable.
Segment Trends — Q2 2026 vs. Q2 2025
| Segment | Revenue Growth YoY | Key Drivers/Signals to Watch Next Quarter |
|---|---|---|
| Consumer Banking & Lending | +6% | Primary checking account growth, credit card/account origination, auto loan growth, deposit mix/costs |
| Commercial Banking | +6% | New client acquisition, loan/deposit growth, treasury/payments, efficiency gains |
| Corporate & Investment Banking | +16% | Investment banking fees, markets revenue, trading asset growth, cross-sell, market share in IB/ECM/M&A |
| Wealth & Investment Mgmt | +13% | Client asset flows, adviser hiring/attrition, lending penetration, margin improvement |
Guidance and Management Commentary
FY26 Guidance (as of Q2 2026)
| Metric | Guidance (FY26) | Context/Notes |
|---|---|---|
| Net Interest Income | $50B ± | NII ex-Markets: ~$48B; Markets NII: ~$2B; loan growth above mid-single digits |
| Noninterest Expense | ~$55.7B | Revenue-related comp higher, offset by efficiency gains; headcount to decline |
| ROTCE | 17–18% medium-term | Q2 at 17.7%; management confident in achieving and raising bar over time |
| CET1 Target | 10–10.5% | Q2 at 10.3%; capital return to continue, pending Basel III finalization |
| Dividend | Q3 to increase 11% | To $0.50/share, subject to board approval |
Management Commentary:
- NII expected to grow in H2, with NIM stabilizing in Q4.
- Loan growth running ahead of plan, especially in C&I, card, and auto.
- Deposit growth strong, led by interest-bearing commercial balances; noninterest-bearing stable.
- Fee income robust, with record IB fees and strong trading/advisory.
- Expenses well-controlled; efficiency ratio improved to 60%.
- Credit quality remains benign; no signs of systemic stress.
- ROTCE at high end of target; management sees multiple levers to sustain/improve returns.
- Markets business asset growth to moderate in H2; focus on cross-sell and profitability.
What to Watch for in Q3 2026 Results
- NII/NIM: Confirmation of NII growth trajectory and NIM stabilization; any change to full-year guidance.
- Loan/Deposit Growth: Whether double-digit growth continues or moderates as guided.
- Fee Income: Sustainability of strong fee growth, especially in IB/trading/wealth.
- Expense Control: Continued headcount reduction and efficiency gains; progress toward $55.7B expense target.
- Credit Quality: Early signs of normalization or stress, especially in consumer and commercial portfolios.
- ROTCE: Progress toward sustaining/exceeding 17–18% target.
- Capital Return: Pace of buybacks/dividends; any update on capital deployment post-Basel III.
- Markets Business: Evidence of cross-sell from financing to trading/fees; impact on NIM and returns.
Summary Table: Q3 2026 Preview — Key Metrics and Expectations
| Metric | Q3 2026E Consensus | Q2 2026 Actual | Q3 2025 Actual | YoY Trend/Comp |
|---|---|---|---|---|
| Revenue ($M) | 22,340 | 22,622 | 21,436 | +4% |
| Net Income ($M) | 5,595 | 6,407 | 5,589 | flat |
| EPS (GAAP) | 1.85 | 2.00 | 1.66 | +11% |
| NII ($M) | 12,317 | 11,950 | +3% | |
| Noninterest Income ($M) | 10,305 | 9,486 | +9% | |
| ROTCE (%) | 17.7 | 15.2 | +250 bps | |
| NIM (%) | 2.43 | 2.61 | -18 bps | |
| Loans ($B) | 1,026.5 | 928.7 | +11% | |
| Deposits ($B) | 1,465.6 | 1,339.9 | +9% | |
| Efficiency Ratio (%) | 60 | 65 | -5 pts |
Conclusion
Wells Fargo is coming off a period of strong growth and operating leverage, with Q2 2026 showing double-digit loan and deposit growth, robust fee income, and ROTCE at the upper end of management's target. The company is not facing a tough YoY comp in Q3 2026; rather, it is building on accelerating momentum. The most important factors for the upcoming report are confirmation of NII/NIM trajectory, sustainability of loan/deposit and fee growth, expense discipline, credit quality, and ROTCE progression. Investors should also watch for updates on capital return and the impact of Basel III finalization. Management remains confident in achieving and potentially exceeding its medium-term ROTCE target, with multiple levers for continued improvement.
