Report: July 14, 2026, at approximately 7:00 a.m. ET
Conference call: 10:00 a.m. ET (newsroom.wf.com)
This quarter is less about whether Wells Fargo can beat the headline EPS estimate and more about whether its post-asset-cap growth is translating into durable revenue, operating leverage, and higher returns.
The setup is reasonably favorable:
The main tension is that Wells Fargo is growing lower-margin Markets assets and interest-bearing commercial deposits faster than its low-cost funding base. That supports total revenue but compresses net interest margin. Investors therefore need to distinguish productive balance-sheet growth from growth that merely makes the bank larger.
A clean quarter would combine higher NII and fees, controlled expenses, stable credit, and reaffirmed guidance. A headline EPS beat accompanied by weaker NII, higher deposit costs, or a softer full-year outlook would be much less convincing.
Consensus varies slightly among providers:
| Metric | Approximate expectation | 2Q25 actual | YoY change |
|---|---|---|---|
| Diluted EPS | $1.71–$1.74 | $1.60 | Approximately 7%–9% |
| Revenue | $21.8–$21.9B | $20.82B | Approximately 5% |
| Net interest income | ~$12.35B | $11.71B | Approximately 6% |
Current published estimates include $1.71 of EPS and $21.80 billion of revenue, although another provider lists $1.74 and $21.88 billion. (marketbeat.com)
Wells Fargo reported first-quarter EPS of $1.60 on $21.45 billion of revenue, including $12.10 billion of NII. Its first-quarter results also included approximately $0.04 per share of discrete tax benefits, making the underlying sequential EPS comparison somewhat less favorable than the reported figures suggest. (sec.gov)
This is likely the quarter’s most important issue.
At a June 9 investor conference, CFO Mike Santomassimo reiterated confidence in the company’s approximately $50 billion full-year NII outlook and said second-quarter NII should step up from the first quarter. He also indicated that net interest margin would probably compress another 3–4 basis points from the first quarter’s 2.47%.
That combination—higher NII but lower NIM—reflects balance-sheet growth:
In the first quarter, average loans rose 10% year over year to $996 billion and average deposits increased 6% to $1.42 trillion. However, NIM fell 20 basis points year over year because of lower-yielding Markets assets and funding-mix changes. (sec.gov)
The full-year target implies meaningful second-half growth. If second-quarter NII is approximately $12.36 billion, Wells Fargo would need about $25.55 billion in the second half, or roughly $12.77 billion per quarter, to reach $50 billion.
A reaffirmation without a credible quarterly bridge may not satisfy investors. Conversely, guidance above $50 billion would be a meaningful positive signal for 2027 earnings power.
The lifting of the asset cap changed Wells Fargo from a constrained balance-sheet story into an execution story. The company is now adding loans, deposits, securities-financing assets, bankers, and client relationships.
The strongest growth has initially appeared in Corporate and Investment Banking:
The concern is that some of the initial growth—particularly Treasury repo and other financing—is low-margin and balance-sheet intensive. Management argues these activities produce good risk-adjusted returns and should unlock trading, investment-banking, payments, and other fee revenue.
Investors should look for evidence that the additional balance sheet is generating broader wallet share:
Management indicated in June that second-quarter Markets revenue was tracking toward mid-teens year-over-year growth. A result near or above that level would support the strategy. A large increase in financing assets without corresponding fee growth would revive concerns that Wells Fargo is sacrificing margin and return on assets to gain market share.
Wells Fargo’s earnings mix is becoming more diversified, reducing its dependence on traditional spread income.
First-quarter Markets revenue grew 19%, while management entered the second quarter with a strong investment-banking pipeline. Financing markets remained open, although equity issuance and advisory activity were vulnerable to macroeconomic and geopolitical volatility.
The most important indicators will be:
Strong fees can offset weaker NIM, but investors will want to see that the incremental revenue produces positive operating leverage.
Wealth and Investment Management was one of the strongest first-quarter businesses:
Most advisory fees are based on beginning-of-quarter asset values, so second-quarter fees principally reflect market levels around April 1 rather than quarter-end values. Management previously noted those values were lower sequentially but higher year over year.
Recruiting, net asset flows, securities-based lending, and the Wells Fargo Premier offering should be important qualitative indicators. Wealth is especially valuable to the return story because its fee revenue requires relatively little incremental capital.
The consumer franchise also has several developing earnings drivers:
Management said in June that card vintages originating in 2022–2024 were profitable in 2026, while the larger 2025–2026 vintages should mature over the next several years. The investor question is whether this growth is beginning to improve current earnings or remains masked by marketing, acquisition, and reserve-building costs.
Management maintained its approximately $55.7 billion 2026 expense outlook at both first-quarter earnings and the June investor conference. (wellsfargo.com)
First-quarter expense was $14.33 billion, including approximately $700 million of seasonal compensation and benefits costs. That suggests second-quarter expense should decline sequentially, although strong Markets and wealth revenue would bring higher incentive and revenue-related compensation.
Important items include:
The best outcome is not necessarily the lowest possible expense number. Wells Fargo should be investing after years of constraint. What matters is whether revenue growth consistently exceeds expense growth.
A revenue beat driven by volatile trading gains, accompanied by an expense-guide increase, would be lower quality. A modest expense beat with continued investment and stronger core revenue would be more constructive.
First-quarter credit remained broadly sound:
Management said in June that consumer credit was performing somewhat better than its monthly models. Nevertheless, higher loan balances—particularly in card, auto, and commercial lending—require additional reserves even if underlying credit quality is stable.
At March 31, loans to “financials except banks” totaled approximately $210 billion, or 21% of total loans. Management has emphasized collateral, low advance rates, structural protections, and historically low losses. The private-credit-related corporate debt finance portfolio was approximately $36 billion.
This exposure is unlikely to drive the quarter absent a specific loss, but it remains an important tail-risk issue. Investors should monitor nonaccrual balances, criticized loans, concentration growth, and any change in management’s confidence.
Wells Fargo ended the first quarter with a 10.3% CET1 ratio, within management’s 10%–10.5% target range and above its 8.5% regulatory requirement. It repurchased $4 billion of common stock during the quarter, reducing average diluted shares by approximately 6% year over year. (sec.gov)
The Federal Reserve’s 2026 stress test projected Wells Fargo’s CET1 ratio falling from 10.6% to a minimum of 9.2% under the severely adverse scenario. The results support the view that Wells Fargo has ample capacity to fund growth and continue returning capital. (federalreserve.gov)
Investors should listen for:
Buybacks are particularly valuable while the shares trade at a moderate earnings multiple. However, declining CET1 caused by rapid risk-weighted-asset growth could limit the pace if earnings or credit weaken.
WFC closed July 13 at $87.69, approximately:
That represents a relatively undemanding setup compared with some large-bank peers, particularly given the company’s buyback capacity and medium-term target of 17%–18% ROTCE. But the stock’s first-quarter decline also shows that investors remain sensitive to NII misses even when EPS is respectable.
The market is unlikely to reward a beat based mainly on taxes, securities marks, reserve releases, or unusually strong trading. It is more likely to reward evidence that the post-cap growth strategy is lifting sustainable earnings and returns.
This would support upward revisions to 2026–2027 estimates and increase confidence in the 17%–18% ROTCE target.
This would represent continued execution but probably require reassuring commentary on second-half NII to generate a strong stock reaction.
That combination would raise doubts about whether post-cap growth is improving shareholder returns or merely diluting margin and capital efficiency.
The most important number may not be EPS. It is the relationship among NII growth, NIM compression, balance-sheet expansion, and fee capture.
Wells Fargo has several genuine earnings levers: commercial-client growth, a rebuilding investment bank, a larger Markets franchise, maturing card vintages, auto expansion, wealth inflows, efficiency savings, and substantial buybacks. The second-quarter report needs to show these levers are beginning to outweigh the funding and investment costs required to restart growth.
The cleanest positive signal would be higher NII, mid-teens Markets growth, stable expenses and credit, continued buybacks, and a confident—preferably improved—second-half outlook. The biggest risk is that rapid balance-sheet growth continues to compress margins faster than fee income and operating leverage can compensate.