Wells Fargo reported mixed fourth-quarter results, combining stronger profitability and balance-sheet expansion with softer-than-expected revenue and efficiency metrics, while outlining an ambitious outlook for 2026.
The bank posted Q4 revenue of $21.29 billion, below the $21.64 billion consensus estimate. Net interest income totaled $12.33 billion, narrowly missing expectations and falling short of management’s own guidance range of $12.4 billion to $12.5 billion.
Key Takeaways
Wells Fargo grew profits year over year despite missing Q4 revenue and NII expectations.
Loan growth strengthened as regulatory constraints eased and assets surpassed $2 trillion.
Management sees around $50 billion in net interest income in 2026, signaling confidence in a more competitive outlook.
Still, interest income rose 4% from a year earlier, reflecting the broader benefit U.S. banks are seeing as older fixed-rate assets reprice into higher-yielding ones.
Profit growth offsets headline misses
Despite the revenue shortfall, Wells Fargo delivered solid bottom-line growth. Net income climbed to $5.36 billion, or $1.62 per share, up from $5.08 billion, or $1.43 per share, a year earlier. The improvement underscores that higher interest earnings and loan growth helped offset margin pressure and rising costs during the quarter.
Loan growth and efficiency remain key themes
Total average loans reached $955.8 billion, beating estimates of $944.29 billion and signaling healthier credit demand than markets expected late in the year. Efficiency, however, lagged. The bank reported an efficiency ratio of 64%, above the 62.6% estimate, pointing to ongoing cost challenges even as revenue stabilizes.
A turning point after regulatory constraints
A major backdrop to the quarter was the removal of Wells Fargo’s long-standing $1.95 trillion asset cap in June, a penalty tied to its fake-accounts scandal. With that restriction lifted, the bank was able to expand its balance sheet, pushing total assets above $2 trillion for the first time.
CEO Charlie Scharf said the bank is now positioned to compete on a “level playing field,” a shift that is increasingly visible in loan growth and strategic planning.
Looking ahead, management guided for about $50 billion in net interest income in 2026 and projected total expenses of roughly $55.7 billion. The outlook suggests confidence that balance-sheet growth and margin normalization can support earnings, even as investors remain focused on execution and efficiency improvements.
WFC is currently trading for $93.56 pre-market after a 1.47% price drop at the time of writing.
