Schwab Profit Grows on Higher Trading Volume
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Charles Schwab Corp., the biggest U.S. discount brokerage, said Tuesday that its first-quarter profit rose as a strong increase in trading volume boosted the company’s commission revenue.
Schwab, based in San Francisco, reported net income of $161 million, or 12 cents a share, compared with $71 million, or 5 cents a share, in the year-earlier period.
Revenue rose 32% to $1.1 billion, Schwab said.
Analysts on average expected earnings of 12 cents a share.
The company said it pulled in $13.8 billion in new customer cash during the quarter, bringing its total client assets to $996 billion -- an increase of 31% from March 2003. Schwab also said its clients opened 57,800 new accounts in March.
Schwab’s daily average revenue trades -- trades on which the company collects a commission -- surged by 7% in March from February, and were 35% higher than in the year-earlier period.
Schwab, whose competitors include E-Trade Financial Corp. and Ameritrade Holding Corp. , has benefited from an increase in enthusiasm by individual investors in recent months, following a prolonged industrywide slump.
Schwab shares fell 35 cents, or 3.22%, to $10.51 on the New York Stock Exchange on Tuesday, before the earnings were released.
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