Wells Fargo Tops Q2 Estimates, Lowers NII Outlook

Wells Fargo reported second-quarter earnings of $1.60 per share on revenue of $20.8 billion, both beating analyst expectations. Net interest income (NII) fell 2% year-over-year to $11.7 billion, leading the bank to cut its full-year NII growth outlook to little changed from last year. The NII decline was due to lower rates on floating-rate assets and changes in deposit mix. Non-interest expenses exceeded forecasts and the bank underperformed in investment banking, despite improved sentiment following the Federal Reserve's removal of its $1.95 trillion asset cap. Credit quality stayed strong, but shares declined as investors responded to mixed results and conservative guidance. Wells Fargo's results set a high bar for peers, with JPMorgan also reporting a slight NII miss.