JPM · Q3 2025 Earnings

Cautious

JPMorgan

Reported October 14, 2025

30-second summary

30-second take: JPMorgan delivered $46.4B revenue (+9% YoY) and $5.07 GAAP EPS at a 20% ROTCE in Q3, raising FY2025 NII ex-Markets guidance for the second straight quarter to ~$95B and cutting the card NCO outlook by 30bps to 3.3%. But the headline is Dimon's "cockroaches" comment on non-bank financial institution (NBFI) lending after the Tricolor incident, paired with a preliminary FY2026 NII ex-Markets guide of ~$95B — flat — which signals management expects zero organic NII growth next year against ~75bps of rate cuts. The Q2 "notably more upbeat" tone has cooled into something more defensive about credit normalization, even as the print itself is clean.

Headline numbers

EPS

Q3 FY2025

$5.07

Revenue

Q3 FY2025

$46.43B

+9.0% YoY

Key financials

Q3 FY2025

Metric	Q3 FY2025	YoY	Q2 FY2025	QoQ
Revenue	$46.43B	+9.0%	$45.68B	+1.6%
EPS	$5.07	—	$5.24	-3.2%

Guidance

JPMorgan raised full-year NII ex-Markets guidance and significantly improved card charge-off outlook for FY2025, signaling continued deposit momentum and consumer resilience; provided preliminary FY2026 NII ex-Markets guidance at ~$95B and Q4 specific guidance.

Guidance is issued for the full year only, refreshed each quarter. Prior and new below are the same FY updated this quarter.

New guidance

Metric	Period	Guide	YoY
NII ex-Markets	Q4 FY2025	approximately $23.5 billion	—
Total NII	Q4 FY2025	about $25 billion	—
Adjusted Expenses	Q4 FY2025	approximately $24.5 billion	—
NII ex-Markets	FY2026	about $95 billion	—

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
NII ex-Markets	FY2025	approximately $92 billion	approximately $95 billion	+$3 billion	Raised
Total NII	FY2025	about $95.5 billion	approximately $95.9 billion (implied by Q4 ~$25B + 9M actuals)	+~$0.4 billion	Raised
Card Net Charge-off Rate	FY2025	approximately 3.6%	approximately 3.3%	-0.3 percentage points	Lowered

Reaffirmed unchanged this quarter: Adjusted Expenses ($95.9 billion)

Segment performance

Q3 FY2025

Segment	Q3 FY2025	YoY
Consumer & Community Banking	$19.473B	+9.0%
Commercial & Investment Bank	$19.878B	+17.0%
Asset & Wealth Management	$6.066B	+12.0%

Capital & returns

Q3 FY2025

Segment	Q3 FY2025
Return on Equity (ROE)	17%
Return on Tangible Common Equity (ROTCE)	20%
CET1 Capital Ratio	14.8%
Tier 1 Capital Ratio	15.8%
Total Deposits	$2,548.5 billion

Other KPIs

Q3 FY2025

Segment	Q3 FY2025
Total Loans	$1,435.2 billion
Net Interest Income	$23,966 million
Provision for Credit Losses	$3,403 million

Management tone

Q1: Tariff-shock caution → Q2: "Notably more upbeat" pipeline confidence → Q3: Cautious credit normalization and NBFI scrutiny.

The pivot from offense to defense on credit is the cleanest shift this year. Last quarter management mechanically reduced the weight of adverse scenarios in their allowance model — they were dialing risk down. This quarter Barnum said "the fact that things are fine now doesn't mean they're guaranteed to be great forever" and explicitly warned that the wholesale charge-off rate "has been very, very low for a long time" and the new direct lending mix "is going to be a little bit higher." Card NCO got cut to 3.3% — but the wholesale and NBFI commentary is bracing for the opposite direction. This is JPM resetting investor expectations away from extrapolating benign credit.

Dimon's "cockroaches" comment marks a sharp tone shift on NBFI. Two quarters ago JPM was framing private credit as a competitive opportunity; one quarter ago Dimon said acquisition was "possible at the right price." This quarter he said "when you see one cockroach, there are probably more. And so everyone should be forewarned on this one," explicitly flagging that NBFI underwriting standards "may not be as good as you think." The Tricolor incident appears to have triggered a portfolio-wide scrutiny exercise. This is not a small comment from a CEO who chooses words carefully.

On AI, Barnum walked the productivity narrative back to old-fashioned headcount discipline. Last quarter's commentary leaned into AI as a productivity unlock. This quarter: "Rather than saying you must prove that you're generating this much savings from AI, which turns out to be a very hard thing to do… let's just do old-fashioned expense disciplines… constrain people's headcount growth." Read as a tell — JPM is skeptical of the vendor-driven AI ROI narrative and is funding the productivity story with headcount caps, not AI capex.

The FY2026 NII ex-Markets guide of ~$95B — flat with FY2025 revised — is the quietly most important number on the call. Management is telling you they expect zero organic NII growth next year, despite continued deposit momentum and loan growth, because 75bps of 2025 cuts plus expected H1 2026 cuts will offset everything. That's a meaningful step down in the earnings trajectory the buy-side has been modeling. The deposit growth inflection that was supposed to accelerate to 6% in 2026 has been "pushed out."

Recurring themes management leaned on this quarter:

Consumer resilience amid labor market uncertaintyNormalization of credit metrics from historically benign levelsBalance sheet growth driving profitability despite rate headwindsCapital deployment discipline constrained by excess capital managementNBFI/Private credit risk concentration and underwriting standard varianceRegulatory environment shifting favorably toward capital rule recalibration

Risks management surfaced:

Labor market deterioration and potential unemployment spikeNBFI lending quality variance and potential unidentified fraud/misunderstanding of collateral (Tricolor precedent)Deposit balance normalization risk from lower savings rates and equity market strengthRate environment headwinds from 75bps cuts in 2025 and expected cuts in H1 2026Credit cycle normalization risk: benign environment masking future deterioration across leverage and NBFI exposures

Q&A highlights

Erica Najarian · UBS

On 2026 expense outlook, whether $100B guidance could be low and if 4% YoY growth represents new normal labor cost inflation, including questions about compensation pressure from hedge funds and private equity

Management confirmed ~3-4% is the new normal for labor inflation aligned with Fed's 2% target plus real growth. Highlighted medical costs rising ~10% annually, competitive pay pressures from non-bank competitors, and offsetting productivity gains including AI-driven improvements. Emphasized commitment to investing for growth while managing cost base inflation across labor, goods, and services.

Medical costs ~$3B annually, expected up 10% in 2026Labor inflation estimated at 3-4% new normalPay-for-performance tied to higher revenuesAI-driven productivity initiatives underway

Jim Mitchell · Seaport Global Securities

Two-part: (1) Investment banking pipeline strength and whether rate cuts will drive financial sponsor activity, (2) How management is adjusting capital deployment given RWA growth and considering returns on buybacks versus alternative uses of capital

Strong IB environment with robust tone. Rate cuts unlikely to meaningfully change sophisticated financial sponsors' behavior, but process queues are full and conditions favorable for IPOs and M&A. On capital: evaluating alternative deployments to buybacks based on relative returns, but committed to franchise-accretive business only and avoiding adding leverage on illiquid par assets without real value generation.

Busiest summer in long time for announced M&A activityIPO pipelines continue despite market volatilityAcquisition finance activity increasingRate environment supportive for deal execution

Erica Najarian · UBS

On NDFI (non-bank financial institutions) credit risk exposure: (1) What questions should investors ask about NDFI credit risk, (2) Should investors be concerned about SSFA accounting reducing RWAs on NDFI exposures from 100% to lower levels

Management indicated NDFI is a very broad category requiring narrower focus (subprime auto vs. lending to trillion-dollar asset managers is different). Comfortable with their exposures. Expects higher-than-normal credit losses in downturn across certain categories. Regarding SSFA: management minimized the concern, noting the mechanism reduces RWA from 100% to 20% where arguably 20% is still too high given risk mitigation, and advised against overweighting this issue.

NDFI exposures range from subprime auto to secured lending to large asset managersExpect higher-than-normal downturn credit losses in certain NDFI categoriesSSFA reduces RWA weighting from 100% to 20%Management suggests monitoring BDCs and publicly traded private credit facilities for comparison

Chris McGrady · KBW

On 15% long-term national retail deposit market share target: does pricing need to be materially more competitive than recent history to achieve four points of market share improvement

Management stated pricing does not need to be materially different, noting they are consciously losing some share through disciplined deposit pricing strategy. Recent FDIC data shows they remain #1 for fifth consecutive year, and they are gaining share in high-priority expansion markets despite slight overall share loss among top banks with similar strategies.

#1 in retail deposits for fifth consecutive year per FDICConscious short-term share losses due to disciplined pricingGaining share in key expansion markets15% target achievable through branch expansion, better products/services, and deepening

Ken Utzden · Autonomous

Two-part: (1) Main drivers of loan yield increase of 3bps despite flat rates during quarter and facing future rate cuts, (2) On Sapphire refresh impact on card fees, card revenue rate, and volume growth timing

On yields: attributed to mix effects across different loan categories (ranging from SOFR+20bps to current loans). Small mix shifts can overwhelm floating rate headwinds. On Sapphire: refresh creates transitional period where customers receive increased rewards/benefits ahead of annual fee increases, creating elevated short-term NIR that will normalize over couple quarters. Card revenue rate currently negative NIR due to this dynamic.

Loan yields up 3bps with no rate movement, driven by mix effectsLoan yields range from SOFR+20bps to current ratesSapphire refresh creates multi-month transitional periodCard revenue rate currently has negative NIR

Answers to last quarter's watch list

Whether NII ex-Markets actually tracks to ~$92B FY2025 — Tracking well above. Management raised the FY2025 guide by another $3B to ~$95B on continued deposit momentum and forward curve changes. Q3 NII of $23.97B and Q4 guide of $23.5B confirm the second-half ramp is real. Status: Resolved positively

Card net charge-off rate holding at ~3.6% — Cut by 30bps to ~3.3% on "favorable delinquency trends driven by the continued resilience of the consumer." Better than the watch threshold by a wide margin. Status: Resolved positively

CET1 trajectory after the dividend lift — CET1 fell 30bps QoQ to 14.8% as expected, absorbing the dividend lift and continued RWA expansion. Management explicitly de-prioritized buybacks at current IRRs and is letting capital build rather than over-distribute. Status: Resolved positively (capital discipline as flagged)

IB fee conversion versus pipeline language — CIB revenue +17% YoY delivered on the "notably more upbeat" tone, with Q&A confirming the "busiest summer in a long time" for announced M&A and IPO pipelines holding. The Q2 language was not overcalibrated. Status: Resolved positively

Any concrete inorganic move, particularly in private credit — No deal announced. Tone on inorganic shifted defensively given Dimon's NBFI "cockroaches" comments and explicit rejection of adding leverage on illiquid par assets without "real value generation." A private credit acquisition looks less likely now than three months ago. Status: Resolved negatively (door has narrowed, not opened)

What to watch into next quarter

Whether the preliminary FY2026 NII ex-Markets guide of ~$95B is reaffirmed or revised when the budget cycle completes — Barnum flagged it as preliminary; any upward revision would force consensus 2026 EPS higher, any downward revision confirms the rate-cut drag is biting harder than expected

NBFI portfolio disclosure or write-downs — Dimon's "cockroaches" language sets up Q4 to either deliver a specific portfolio breakdown / additional provision build or expose the warning as macro-prudential signaling without portfolio impact; watch the wholesale provision line and any new NBFI exposure disclosures

Card NCO trajectory after the cut to 3.3% — guidance was lowered on "favorable delinquency trends," but management simultaneously warned consumer resilience is conditional on the labor market; watch whether delinquency formation re-accelerates and forces a partial give-back

Q4 expense print vs. the ~$24.5B guide and the implied 2026 ~$100B+ run-rate — Barnum signaled consensus 2026 expenses look "a little bit low"; the Q4 print sets the jumping-off point and confirms or denies the labor inflation framing

CET1 at 14.8% (-30bps QoQ) with continued RWA expansion — watch whether buyback pace stays subdued (Mitchell exchange signaled it will) and whether any inorganic action emerges into year-end despite the more defensive NBFI tone

Sources

JPMorgan Q3 2025 Earnings Press Release Supplement, SEC Form 8-K Exhibit 99.2 — https://www.sec.gov/Archives/edgar/data/19617/000162828025044845/a3q25erfex992supplement.htm
JPMorgan Q3 2025 earnings call transcript (management prepared remarks and Q&A)

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