JPMorgan Chase 10-Kyear ended 2025-12-31
Trading and wealth-management gains lifted revenue, but Apple Card reserves and higher expenses weighed on earnings ahead of the portfolio transfer.
Filed 2026-02-13 16:20 ET
Key figures · FY2025 · period ended 2025-12-31
- Net revenue$182.4B1YoY +2.8%
- Net income$57.0BYoY −2.4%
- Total assets$4.4TYoY +10.5%
- Total debt$500.0B2YoY +10.1%
How total debt adds up Long-term debt (included $134,559 and $100,780 at fair value) $435,206M + Short-term borrowings (included $32,460 and $26,521 at fair value) $64,776M Total debt $499,982M Lines as the filer presents them on its balance sheet.
- Shareholders' equity$362.4BYoY +5.1%
- Tangible book value$298.0B3YoY +6.3%
Notes (3)
- Net revenue: Net interest income plus non-interest income, as the filer presents them.
- Total debt: Excludes deposits, repurchase agreements, federal funds purchased and securities loaned. Borrowings the company raised to fund itself: long-term and short-term borrowings, FHLB advances, subordinated debt and finance leases. About the summary: The summary's $435B is the Long-term debt (included $134,559 and $100,780 at fair value) line, one of the 2 lines that make up total debt (see ⓘ).
- Tangible book value: Goodwill, mortgage servicing rights and other intangible assets, which this bank presents as one line. The servicing rights are deducted too, which this bank's own tangible equity does not do.
How this filing reads
- Health+0.6CET1 was 14.6% and tangible common equity rose to $290B, supporting substantial balance-sheet capacity.
- Momentum−0.2Revenue rose 2.8%, while net income fell 2.4% and credit-loss provision increased 33.1%.
- Outlook+0.2Management expects FY2026 net interest income of $103B and adjusted expenses of $105B.
Executive Summary
JPMorgan Chase grew revenue in FY2025 through stronger trading, investment banking and asset-management activity, but higher expenses and credit costs reduced net income. The prospective Apple Card portfolio adds a consumer-lending opportunity while already increasing reserves and capital requirements, well before the expected transfer closes. For investors, the question is whether diversified fee growth and a larger net interest income base can outpace credit normalization, technology spending and the capital consumed by growth.
Key Financial Highlights
| FY2025 metric | Result | Investor interpretation |
|---|---|---|
| Total assets | $4.42T | Scale supports diversification but brings substantial funding and regulatory demands. |
| Total stockholders’ equity | $362B | Capital base supporting balance-sheet growth and distributions. |
| Tangible common equity | $290B, up from $272B | Growth in capital available to common shareholders after intangible assets. |
| Total net revenue | $182B, +2.8% Y/Y | Markets and fees offset less favorable comparisons elsewhere. |
| Net interest income | $95.4B | Largest revenue component; sensitive to rates and deposit pricing. |
| GAAP net income | $57.0B, −2.4% Y/Y | Expense and credit-cost growth outweighed revenue gains. |
| Noninterest expense | $95.6B, +4.2% Y/Y | Compensation, technology and distribution costs rose. |
| Provision for credit losses | $14.2B, +33.1% Y/Y | Includes reserves established for the prospective Apple Card portfolio. |
- Earnings quality: Operating cash flow was $(148)B vs net income of $57.0B. The divergence principally reflected growth in trading assets, securities borrowed and loans held for sale, rather than an equivalent operating loss.
- Capital return: Repurchases totaled $31.6B, or 114M shares; shares outstanding fell from 2.80B to 2.70B, a net reduction of 101M shares. Diluted EPS rose to $20.02 from $19.75 despite lower net income.
- Credit: The allowance for credit losses increased $4.4B to ≈$31.2B; net charge-offs rose to $9.85B from $8.64B. The Apple Card-related allowance contributed $2.2B to the provision.
- Comparability: FY2024 included a $7.9B Visa-share gain and a $1.0B Visa-share foundation contribution; FY2025 included a $588M First Republic-related gain and a $774M tax benefit. These items complicate a simple reading of underlying earnings growth.
- Capital and funding: The standardized common equity Tier 1 ratio was 14.6%, while long-term debt was $435B. Deposits remained the principal funding source at $2.56T, although their share of liabilities declined to 63% from 66%.
Business Developments
- Commercial & Investment Bank: Revenue reached $78.5B. Markets revenue grew 19% to $35.8B, and investment banking fees rose 7% to $9.74B; market-sensitive businesses were the principal growth engine.
- Asset & Wealth Management: Revenue grew 12% to $24.1B. Assets under management reached $4.79T, up 18%, supported by $392B of net flows and market/performance gains. This expands the fee base, though market levels remain an important driver.
- Consumer & Community Banking: Revenue was $76.0B, with card sales volume up 7%. Higher rewards costs and partner payments pressured card income, while credit costs weighed on results.
- Apple Card: Chase signed a forward purchase commitment on 12/30/2025 to become the issuer, with closing expected in ≈24 months. Estimated transaction-related exposure was $104B, including $23B of estimated drawn loans. The transaction broadens card reach, but its reserve and capital costs precede the expected revenue contribution.
Risk Assessment
- Surveillance controls: A March 2024 regulatory consent order concerning trading-venue inventories and trade-surveillance data remains in effect; remediation demands could add costs or constrain activities.
- Consumer and wholesale credit: Rising charge-offs, card growth and losses in certain secured-lending facilities expose earnings to borrower deterioration; commercial real estate refinancing and property values are additional vulnerabilities.
- Capital intensity: The Apple Card transaction added ≈$23B of standardized and ≈$110B of advanced risk-weighted assets, reducing standardized capital ratios by ≈25 bp. Further growth or revised capital rules could limit distributions.
- Funding and liquidity: Estimated uninsured deposits were $1.56T, and short-term secured funding rose to $498B, principally for Markets activity; deposit migration or market stress could increase replacement-funding costs.
- Rates and valuations: Changing rates affect net interest income, deposit costs and securities values. Held-to-maturity securities had fair value of $253B vs $270B amortized cost at year-end, making liquidity-driven sales potentially costly.
- Cyber and operational resilience: Prior disruptions and breaches, reliance on third parties, and increasingly sophisticated attacks—including AI-enabled threats—create service, fraud, remediation and reputational risks.
- Litigation and geopolitics: Reasonably possible legal losses above reserves ranged from $0 to ≈$1.2B; Russia-related sanctions litigation and wider geopolitical disruption could create additional losses or operational constraints.
Strategic Outlook and Investor Actionables
Management expects FY2026 net interest income of ≈$103B and adjusted expense of ≈$105B; the income outlook depends on market conditions, while the expense plan signals continued investment. The investment case rests on converting that spending and the Apple Card expansion into durable earnings without allowing credit losses or capital consumption to absorb the benefit.
- Net interest income and costs: Compare results with the ≈$103B income outlook and ≈$105B adjusted-expense outlook; a widening expense burden without corresponding revenue growth would weaken the thesis.
- Card credit: Track the Card Services net charge-off rate against management’s ≈3.4% FY2026 expectation, alongside allowance changes, to distinguish planned portfolio growth from deteriorating borrowers.
- Capital and funding: Watch advanced capital requirements, the standardized common equity Tier 1 ratio and deposit trends as Apple Card preparations continue; sustained pressure would narrow buyback flexibility.
Figures are computed from the filing's XBRL data; the summary and scores are written by an AI model reading the filing.
Model 005 · prompt 9e47f58d3c