JPM Kicks Off Q4 Earnings Season With Rare Miss Driven By Weakness In Debt Underwriting

January 13, 2026

Ahead of the official start of earnings season this morning when JPM reported Q4 results, Goldman’s head of Delta One Rich Privorotsky wrote that “attention now turns to JPM to set tone for earnings seasons. Prices/multiples are elevated across the sector so hard to argue expectations are low. Focus on NII/NIM durability as deposit costs and loan pricing adjust… trading and IB momentum… expense discipline against the now well-telegraphed ~$105bn 2026 expense guide (~10% increase) … and any change in credit quality (likely still benign near-term).”

With that in mind, moments ago JPM reported Q1 earnings that while beating on sales and trading, unexpectedly missed on revenue and earnings, with traders pointing to a rare miss in investment-banking fees which fell in Q4, missing the firm’s own guidance from just last month. The biggest US bank generated $2.35 billion from the business in the last three months of 2025, down 5% from a year earlier, according to a statement Tuesday. The firm said in December that it expected a percentage gain in the “low single digits.”

The investment-banking results were largely driven by a surprise 2% decline in debt-underwriting fees while analysts expected a 19% gain.

This was partially offset by stronger than expected Q4 trading revenue, which came in at $8.24 billion, ahead of even the highest estimate of analysts in the survey, with both equity and fixed-income traders beating expectations.

As we previewed yesterday, JPMorgan kicks off the banking industry’s Q2 results Tuesday, with megabank rivals Bank of America, Wells Fargo, Citigroup, Goldman Sachs Group Inc. and Morgan Stanley slated for Wednesday and Thursday. The group’s is expected to post its second-highest annual profit ever, boosted by President Donald Trump’s policy changes.

Here is a snapshot of what JPM reported:

Net Income $13.0BN, down 7% YoY
Full year 2025 Net Income was $57 billion, which short of beating its 2024 record, which was the highest annual profit in the history of American banking.
EPS $4.63, Missing estimates of $4.97
Adjusted revenue $46.77 billion, beating estimates $46.35 billion; This was driven by NII of $25.11B, up 7% YoY; and NIR of $21.7B, up 7% YoY
- Markets revenue of $8.2B, up 17% YoY
- FICC sales & trading revenue $5.38 billion, +7.5% y/y, estimate $5.27 billion
- Equities sales & trading revenue $2.86 billion, +40% y/y, estimate $2.7 billion
- Investment banking revenue $2.55 billion, -1.9% y/y, estimate $2.65 billion
- Advisory revenue $1.03 billion, -2.5% y/y, estimate $953.9 million
- Equity underwriting rev. $416 million, -16% y/y, estimate $499.5 million
- Debt underwriting rev. $898 million, -2.5% y/y, estimate $1.1 billion

Some more highlights here:

NII ex. Markets of $23.9B, up 4% YoY, reflecting the impact of higher deposit balances, as well as higher revolving balances in Card Services, largely offset by the impact of lower rates
NIR ex. Markets of $14.7B, up 7% YoY, driven by higher asset management fees in AWM and CCB, higher auto operating lease income and higher Payments fees, partially offset by lower card income
Expense of $24.0B, up 5% YoY, driven by higher compensation, including higher revenue-related compensation and growth in front office employees, as well as higher auto lease depreciation, higher brokerage expense and distribution fees and higher occupancy expense, partially offset by an FDIC special assessment accrual release

Especially notable is that in Q4, JPM’s reserve build soared to $2.1BN, highest since Covid, reflecting $2.2BN reserve established for forward purchase commitment of Apple credit card business, which must have been an epic disaster under Goldman. Combined with $2.51BN in charge offs (which was below estimates of $2.56BN), this meant that total credit costs were a whopping $4.7 billion, also highest since covid.

Some more details from the quarter:

Loans $1.49 trillion, +11% y/y, beating estimate $1.45 trillion
Total deposits $2.56 trillion, missing estimate $2.58 trillion
Compensation expenses $13.12 billion, +5.2% y/y, beating estimate $13.74 billion
Non-interest expenses $23.98 billion, +5.4% y/y, higher than estimate $24.65 billion
Net yield on interest-earning assets 2.54% vs. 2.61% y/y, beating estimate 2.53%
Standardized CET1 ratio 14.5% vs. 15.7% y/y, estimate 14.8%
Managed overhead ratio 51%, missing estimate 53.1%
Return on equity 15%, missing estimate 15.7%
Return on tangible common equity 18%, missing estimate 18.9%
Tangible book value per share $107.56, beating estimate $106.66
Book value per share $126.99, estimate $126.47
Cash and due from banks $21.74 billion, estimate $22.24 billion

Some more:

Assets under management $4.79 trillion, beating estimate $4.73 trillion

Turning to the all important Commercial and Investment Bank division, it was a story of two opposing halves: solid Markets revenue and disappointing Banking performance. Starting with the former:

Markets revenue of $8.2B, up 17% YoY
- Fixed Income Markets revenue of $5.38B, beating est of $5.27B, up 7% YoY, driven by strong performance in Securitized Products, Rates and Currencies & Emerging Markets, largely offset by lower revenue in Credit
- Equity Markets revenue of $2.86B, beating est of $2.7B, up 40% YoY, driven by higher revenue across products, particularly in Prime
Securities Services revenue of $1.5B, up 13% YoY, driven by higher deposit balances as well as fee growth on higher market levels and client activity

That’s the good news. The not so good news was the surprising weakness in Investment Banking and especially Debt Underwriting:

IB revenue of $2.6B, down 2% YoY; IB fees down 5% YoY, driven by lower fees across all products
- Equity underwriting rev. $416 million, -16% y/y, missing estimate $499.5 million
- Debt underwriting rev. $898 million, -2.5% y/y, missing estimate $1.1 billion
The only silver lining: advisory revenue $1.03 billion, which also declined 2.5% y/y, but beat estimates of $953.9 million

“The U.S. economy has remained resilient,” said CEO Jamie Dimon adding that “while labor markets have softened, conditions do not appear to be worsening. Meanwhile, consumers continue to spend, and businesses generally remain healthy.” Dimon said those conditions “could persist for some time, particularly with ongoing fiscal stimulus, the benefits of deregulation and the Fed’s recent monetary policy. However, as usual, we remain vigilant, and markets seem to underappreciate the potential hazards—including from complex geopolitical conditions, the risk of sticky inflation and elevated asset prices.”

In the first three quarters of last year, the biggest banks increased their loan books at the fastest pace since the financial crisis — boosting net interest income.

JPMorgan’s loans climbed 4% in the last three months of the year from the previous quarter. NII climbed 7% from a year earlier. The bank said in a presentation Tuesday that it expects to earn about $103 billion in NII in 2026.

The bank also reiterated that it expects to spend about $105 billion this year. Marianne Lake, who runs the bank’s consumer and community bank, previewed that outlook — which was higher than analysts had been expecting — at an industry conference last month, saying the biggest driver is “volume- and growth-related expenses.”

+1% pre mkt… PPNR beat driven by better NII, fees and lower expenses (lower comp). In his commentary, Dimon noted a resilient economy with consumers continuing to spend though acknowledged that labor markets have softened and the market seems to underappreciate potential hazards… the key focus here will be

Finally, while the historical numbers were mixed, all eyes were on the bank’s guidance. Here, JPM reiterated what we already knew – expenses would be $105bn for FY26…

… and NII ex markets was $95bn…

… but the bank gave a markets NII of ~$8bn, putting total NII modestly above consensus, and helping stabilize the stock.

Putting it all together, the market reaction was mixed, with the price first sliding in premarket trading on the IB miss, before rebounding on the strong markets revenue and the NII forecast which was modestly above consensus, before eventually stabilizing to unchanged as much of what was reported was already known.