Charles Schwab Corp. jumped in early New York trading after reporting earnings per share that topped analyst estimates and curbing some of its expensive debt — a sign the firm has moved past a bout of turbulence last year.
The company said adjusted earnings per share for the third quarter were 77 cents, beating analyst forecasts. Adjusted net income for the period was $1.5 billion, up slightly on the prior year.
Schwab's client transactional cash sweep — which took a hit when customers shuffled funds in search of better-yielding options — climbed $9.2 billion sequentially, helping the firm reduce costly bank supplemental funding by $8.9 billion, it said in a statement Tuesday.
Shares of the firm were up 7.7% as of 10:00 a.m. in New York.
Schwab is emerging from what it called one of its most challenging years in decades last year, as steep interest rate hikes took their toll on its businesses.
Customers had yanked their deposits from Schwab's bank in search of higher-yielding alternatives, causing the company to seek out more expensive funding sources. Higher rates also saddled the company with paper losses as the value of its bond investments took major hits.