SCHWAB CHARLES CORP
For the period ended Dec 31, 2025. Filed Feb 25, 2026.
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FY2025 · Filed Feb 25, 2026
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Non-GAAP Financial Measures
In addition to disclosing financial results in accordance with generally accepted accounting principles in the U.S. (GAAP), Management’s Discussion and Analysis of Financial Condition and Results of Operations contain references to the non-GAAP financial measures described below. We believe these non-GAAP financial measures provide useful supplemental information about the financial performance of the Company, and facilitate meaningful comparison of Schwab’s results in the current period to both historic and future results. These non-GAAP measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may not be comparable to non-GAAP financial measures presented by other companies.
Schwab’s use of non-GAAP measures is reflective of certain adjustments made to GAAP financial measures as described below.
| Non-GAAP Adjustment or Measure | Definition | Usefulness to Investors and Uses by Management |
|---|---|---|
| Acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs | Schwab adjusts certain GAAP financial measures to exclude the impact of acquisition and integration-related costs incurred as a result of the Company’s acquisitions, amortization of acquired intangible assets, restructuring costs, and, where applicable, the income tax effect of these expenses. Adjustments made to exclude amortization of acquired intangible assets are reflective of all acquired intangible assets, which were recorded as part of purchase accounting. These acquired intangible assets contribute to the Company’s revenue generation. Amortization of acquired intangible assets will continue in future periods over their remaining useful lives. | We exclude acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs for the purpose of calculating certain non-GAAP measures because we believe doing so provides additional transparency of Schwab’s ongoing operations, and is useful in both evaluating the operating performance of the business and facilitating comparison of results with prior and future periods. Costs related to acquisition and integration or restructuring fluctuate based on the timing of acquisitions, integration and restructuring activities, thereby limiting comparability of results among periods, and are not representative of the costs of running the Company’s ongoing business. Amortization of acquired intangible assets is excluded because management does not believe it is indicative of the Company’s underlying operating performance. |
| Return on tangible common equity | Return on tangible common equity represents annualized adjusted net income available to common stockholders as a percentage of average tangible common equity. Tangible common equity represents common equity less goodwill, acquired intangible assets — net, and related deferred tax liabilities. | Acquisitions typically result in the recognition of significant amounts of goodwill and acquired intangible assets. We believe return on tangible common equity may be useful to investors as a supplemental measure to facilitate assessing capital efficiency and returns relative to the composition of Schwab’s balance sheet. |
| Adjusted Tier 1 Leverage Ratio | Adjusted Tier 1 Leverage Ratio represents the Tier 1 Leverage Ratio as prescribed by bank regulatory guidance for the consolidated company and for CSB, adjusted to reflect the inclusion of AOCI in the ratio. | Inclusion of the impacts of AOCI in the Company’s Tier 1 Leverage Ratio provides additional information regarding the Company’s current capital position. We believe Adjusted Tier 1 Leverage Ratio may be useful to investors as a supplemental measure of the Company’s capital levels. |
The Company also uses adjusted diluted EPS and return on tangible common equity as components of performance criteria for employee bonus and certain executive management incentive compensation arrangements. The Compensation Committee of CSC’s Board of Directors maintains discretion in evaluating performance against these criteria. Additionally, the Company uses adjusted Tier 1 Leverage Ratio in managing capital, including its use of the measure as its long-term operating objective.
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The following tables present reconciliations of GAAP measures to non-GAAP measures:
| Year Ended December 31, | |||
|---|---|---|---|
| 2025 | 2024 | 2023 | |
| Total expenses excluding interest (GAAP) | $12,462 | $11,914 | $12,459 |
| Amortization of acquired intangible assets | (512) | (519) | (534) |
| Acquisition and integration-related costs (1) | — | (117) | (401) |
| Restructuring costs (2) | — | (9) | (495) |
| Adjusted total expenses (non-GAAP) | $11,950 | $11,269 | $11,029 |
(1) Acquisition and integration-related costs for 2024 primarily consist of $54 million of compensation and benefits, $36 million of professional services, and $19 million of depreciation and amortization. Acquisition and integration-related costs for 2023 primarily consist of $187 million of compensation and benefits, $135 million of professional services, $28 million of occupancy and equipment, and $27 million of other expense.
(2) Restructuring costs for 2024 reflect a benefit due to a change in estimate of $34 million in compensation and benefits, offset by $5 million of occupancy and equipment expense and $37 million of other expense. Restructuring costs for 2023 primarily consist of $292 million of compensation and benefits, $17 million of occupancy and equipment, and $181 million of other expense.
| Year Ended December 31, | ||||||
|---|---|---|---|---|---|---|
| 2025 | 2024 | 2023 | ||||
| Amount | Diluted EPS | Amount | Diluted EPS | Amount | Diluted EPS | |
| Net income available to common stockholders (GAAP), Earnings per common share — diluted (GAAP) | $8,417 | $4.65 | $5,478 | $2.99 | $4,649 | $2.54 |
| Amortization of acquired intangible assets | 512 | .29 | 519 | .28 | 534 | .29 |
| Acquisition and integration-related costs | — | — | 117 | .06 | 401 | .22 |
| Restructuring costs | — | — | 9 | — | 495 | .27 |
| Income tax effects (1) | (122) | (.07) | (154) | (.08) | (338) | (.19) |
| Adjusted net income available to common stockholders (non-GAAP), Adjusted diluted EPS (non-GAAP) | $8,807 | $4.87 | $5,969 | $3.25 | $5,741 | $3.13 |
(1) The income tax effects of the non-GAAP adjustments are determined using an effective tax rate reflecting the exclusion of non-deductible acquisition costs and are used to present the acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs on an after-tax basis.
| Year Ended December 31, | |||
|---|---|---|---|
| 2025 | 2024 | 2023 | |
| Return on average common stockholders’ equity (GAAP) | 21% | 15% | 16% |
| Average common stockholders’ equity | $40,923 | $35,475 | $29,334 |
| Less: Average goodwill | (11,951) | (11,951) | (11,951) |
| Less: Average acquired intangible assets — net | (7,488) | (8,002) | (8,524) |
| Plus: Average deferred tax liabilities related to goodwill and acquired intangible assets — net | 1,691 | 1,741 | 1,805 |
| Average tangible common equity | $23,175 | $17,263 | $10,664 |
| Adjusted net income available to common stockholders (1) | $8,807 | $5,969 | $5,741 |
| Return on tangible common equity (non-GAAP) | 38% | 35% | 54% |
(1) See table above for the reconciliation of net income available to common stockholders to adjusted net income available to common stockholders (non-GAAP).
| December 31, 2025 | December 31, 2024 | December 31, 2023 | ||||
|---|---|---|---|---|---|---|
| CSC | CSB | CSC | CSB | CSC | CSB | |
| Tier 1 Leverage Ratio (GAAP) | 9.3% | 11.1% | 9.9% | 11.6% | 8.5% | 10.1% |
| Tier 1 Capital | $42,844 | $28,126 | $45,186 | $32,584 | $40,602 | $31,777 |
| Plus: AOCI adjustment | (11,017) | (9,562) | (14,839) | (12,938) | (18,131) | (15,746) |
| Adjusted Tier 1 Capital | 31,827 | 18,564 | 30,347 | 19,646 | 22,471 | 16,031 |
| Average assets with regulatory adjustments | 462,473 | 252,828 | 458,119 | 280,701 | 476,069 | 315,851 |
| Plus: AOCI adjustment | (11,333) | (9,875) | (14,831) | (13,037) | (19,514) | (17,194) |
| Adjusted average assets with regulatory adjustments | $451,140 | $242,953 | $443,288 | $267,664 | $456,555 | $298,657 |
| Adjusted Tier 1 Leverage Ratio (non-GAAP) | 7.1% | 7.6% | 6.8% | 7.3% | 4.9% | 5.4% |
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.