JPMorgan Stock Rises as Q3 Earnings Handily Beat Estimates

JPMorgan Chase (JPM) shares rose Friday morning after reporting revenue and net interest income growth in its third-quarter results Friday as big banks' earnings season gets under way.

The world's largest bank by market cap posted revenue of $42.65 billion, well above the $39.87 billion it reported a year ago and the $40.85 billion consensus estimate of analysts compiled by Visible Alpha. Reported net interest income (NII) rose to $23.41 billion from $22.73 billion.

Profit fell slightly to $12.9 billion from $13.15 billion, but edged higher to $4.37 from $4.33 on a per-share basis. Analysts were expecting $11.81 billion, or $3.97 per share.

JPMorgan shares, which had risen about 25% this year through Thursday's close, were up just under 2% in premarket trading after the report's release.

Rising Deposit Costs Have Impacted Bank Earnings

Higher interest rates in recent years helped JPMorgan and other banks reach record levels of net interest income, but rising deposit costs have impacted bank earnings in recent quarters while loan growth has stalled.

JPMorgan and other banks are reporting earnings amid a shifting economic environment, as the Federal Reserve last month cut interest rates for the first time since 2020. Analysts expect that the newly lowered rates and potential for future cuts should help lower deposit costs and spark more investment banking and loan growth in the coming quarters.

Analyst and investor attention has also focused recently on how JPMorgan will form a succession plan for 68-year-old Chief Executive Officer (CEO) Jamie Dimon. The influential executive has said in recent months that the bank wants to make sure it gets the plan right when he steps away in the coming years.

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