Unpack the new 2027 NII ex Markets central case of $107 billion, including assumptions on balance sheet growth, deposit pricing, and higher rates.

The $5 billion growth from Q4 annualized NII ex Markets ($102B) to $107B is about 1/4 from the yield curve (forward curve hikes) and the rest from continuation of balance sheet growth and mix trends (modest consumer deposit growth, wholesale deposit growth, card loans). “That $5 billion, probably about 1/4 of that, I would say, is related to the yield curve. So we remain asset sensitive and probably a little bit more asset sensitive than the EAR shows just because of the lower than modeled deposit betas.”

Explain the $1 billion buyback versus the normal cadence and capital priorities, especially with Basel III Endgame nearing finalization.

Capital priorities are: dividend, organic growth investments, then buybacks. The reduced buyback is due to opportunities to redeploy capital at very good returns organically, which is considered better than buying stock at current earnings yield. The firm has ample excess capital ($30B roughly) and has deployed a lot organically (e.g., Security Resiliency Initiative). “The positive news is the main reason the buyback is down, and it's got another to do with AOCI or guessing about the environment or maybe Basel III. We believe now, which is different than we told you in the past that we can redeploy that capital at very good returns over time.”

Quantify AI benefits for JPM, update on AI spend, and address the risk of AI agents taking deposits, emphasizing JPM's value proposition and trust.

AI expense is significantly less than $2B annually, but it's diffused across the institution and hard to ring-fence. Benefits are not yet visible in quarterly earnings but are exciting internally (e.g., software rewrite experiments). The firm is reluctant to quantify benefits due to complexity. On agents, JPM protects clients from credential sharing and insecure methods. Trust is a key asset, built over decades, but doesn't excuse complacency in customer experience. “I'm just very reluctant to spend a lot of energy quantifying it because it winds up wasting a lot of people's time inside the institution when we actually need to get them to focus on doing things.”

JPM

JPMorgan Chase (JPM) Q3 FY26 earnings call: guidance and Q&A

Earnings call· Sep 2026 (Q3 FY26)· Financials· Oct 13, 2026

Source: earnings call transcript

Executive summary

JPMorgan Chase Q3 FY26 — Strong Performance Across Businesses with Capital Deployment Focus

JPMorgan Chase delivered a strong third quarter, driven by robust revenue growth across its diversified businesses, particularly in markets and asset management. The firm is actively deploying capital into organic growth opportunities, which is currently prioritized over share buybacks, reflecting confidence in future returns. Management also addressed the evolving landscape of AI, emphasizing client protection and strategic internal adoption while navigating potential competitive pressures and regulatory uncertainties.

Highlights

Net income of $15.3 billion, with EPS of $5.57 and ROTCE of 20%.
Revenue up 8% year-on-year to $50.9 billion, or 9% excluding net investment securities losses.
CCB deposit growth of 4% year-on-year, with 650,000 net new checking accounts this quarter.
CIB IB fees up 14% year-on-year, and Equities revenue up 49% year-on-year.
AWM long-term net inflows of $51 billion, driving AUM up 13% year-on-year to $5.2 trillion.

Concerns

Expenses up 12% year-on-year to $27.3 billion, driven by volume, revenue-related expenses, and wage inflation.
Standardized CET1 ratio down 30 basis points quarter-on-quarter to 13.9% due to OCI losses, higher RWA, and capital distributions.
Markets fixed income revenue down 4% year-on-year.
Net reserve build of $539 million, contributing to credit costs of $2.7 billion.

Guidance & targets

Category	Target	Timeline	Confidence
NII ex Markets	approximately $25.5 billion high materiality	Q4 · FY26	High
Total NII	about $28 billion high materiality	Q4 · FY26	High
NII ex Markets	approximately $107 billion high materiality	FY27	Medium
Expenses	about $27.5 billion high materiality	Q4 · FY26	High
Card net charge-off rate	approximately 3.2% medium materiality	FY26	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Consumer & Community Banking (CCB) Revenue driven by higher balances and yield in card, asset management fees, deposit balances, and auto lease income. Strong consumer demand supported spend growth. Debit and credit spend growth: 10% YoYDeposit growth: 4% YoYRetail deposit share: #1 (based on FTSE data)Investment assets: $1.4 trillionInvestment assets growth: 15% YoY	$21.2 billion	9%	—	$5.7 billion (Net Income)
Corporate & Investment Bank (CIB) Strong performance across businesses, notably in advisory for IB fees and outperformance in prime and derivatives for equities. Fixed income was down due to commodities, rates, and credit, partially offset by currencies and emerging markets. IB fees growth: 14% YoYMarkets fixed income growth: -4% YoYEquities growth: 49% YoY	$22.7 billion	14%	—	$8.2 billion (Net Income)
Asset & Wealth Management (AWM) Revenue driven by growth in management fees on higher average market levels, strong net inflows (largely fixed income), and higher loan balances. Long-term net inflows: $51 billionAUM: $5.2 trillionAUM growth: 13% YoYClient assets: $7.9 trillionClient assets growth: 15% YoY	$6.9 billion	14%	—	$1.8 billion (Net Income), 36% (Pretax Margin)
Corporate Included $658 million of net investment securities losses.	$93 million	—	—	-$455 million (Net Loss)

JPM operating KPIs by quarter

JPM operating KPIs stated on its earnings calls, by fiscal quarter
KPI	Dec 2024 Q4 FY24	Mar 2025 Q1 FY25	Jun 2025 Q2 FY25	Sep 2025 Q3 FY25	Dec 2025 Q4 FY25	Mar 2026 Q1 FY26	Jun 2026 Q2 FY26	This call Sep 2026 Q3 FY26	Change vs prior quarter
Return on tangible common equity (ROTCE)	21% The firm reported net income of $14 billion, EPS of $4.81 on revenue of $43.7 billion, with an ROTCE of 21%. Source: earnings call transcript	21% The firm reported net income of $14.6 billion, EPS of $5.07 on revenue of $46 billion with an ROTCE of 21%. Source: earnings call transcript	—	20% So with that, turning to this quarter's results, the firm reported net income of $14.4 billion and EPS of $5.07 with an ROTCE of 20%. Source: earnings call transcript	18% This quarter, the firm reported net income of $13 billion and EPS of $4.63 with an ROTCE of 18%. Source: earnings call transcript	23% This quarter, the firm reported net income of $16.5 billion and EPS of $5.94 with an ROTC of 23%. Source: earnings call transcript	23% Including the significant items noted on the page, the firm delivered net income of $16.9 billion, EPS of $6.14 and an ROTCE of 23%. Source: earnings call transcript	20% The firm delivered net income of $15.3 billion, EPS of $5.57 and an ROTCE of 20%. Source: earnings call transcript	-3 pt
Common equity tier 1 ratio (CET1)	15.7% We ended the quarter with a CET1 ratio of 15.7%, up 40 basis points versus the prior quarter, as net income and lower RWA were largely offset by both OCI losses and capital distributions, which included $4 billion of net common share repurchases this quarter. Source: earnings call transcript	15.4% We ended the quarter with a CET1 ratio of 15.4%, down 30 basis points versus the prior quarter, as net income and OCI gains were more than offset by capital distributions and higher RWA. Source: earnings call transcript	15% We ended the quarter with a CET1 ratio of 15%, down 40 basis points versus the prior quarter as net income was more than offset by capital distributions and higher RWA. Source: earnings call transcript	14.8% And in terms of the balance sheet, we ended the quarter with a CET1 ratio of 14.8%, down 30 basis points versus the prior quarter. Source: earnings call transcript	14.5% And in terms of the balance sheet, we ended the quarter with a standardized CET1 ratio of 14.5%, down 30 basis points versus the prior quarter, as net income was more than offset by capital distributions and higher RWA. Source: earnings call transcript	14.3% And in terms of the balance sheet, we ended the quarter with a standardized CET1 ratio of 14.3%, down 30 basis points versus the prior quarter as net income was more than offset by capital distributions and higher RWA. Source: earnings call transcript	14.1% And in terms of the balance sheet, we ended the quarter with a standardized CET1 ratio of 14.1%, down 20 basis points versus the prior quarter as net income was more than offset by higher RWA and capital distributions. Source: earnings call transcript	13.9% In terms of the balance sheet, we ended the quarter with a standardized CET1 ratio of 13.9%, down 30 basis points versus the prior quarter as net income was more than offset by OCI losses, higher RWA and capital distributions. Source: earnings call transcript	-0.2 pt
Long-term net inflows Asset & Wealth Management	$76B Long-term net inflows were $76 billion for the quarter, positive across all asset classes. Source: earnings call transcript	$54B Long-term net inflows were $54 billion for the quarter, primarily driven by equity and fixed income. Source: earnings call transcript	$31B Long-term net inflows were $31 billion for the quarter led by fixed income and equities. Source: earnings call transcript	$72B Long-term net inflows were $72 billion for the quarter, led by fixed income and equities. Source: earnings call transcript	$52B Long-term net inflows were $52 billion for the quarter and $209 billion for the full year, positive across all channels, regions and asset classes. Source: earnings call transcript	$54B Long-term net inflows were $54 billion with continued strength across fixed income, equity and multi-asset. Source: earnings call transcript	$50B Long-term net inflows were $50 billion with continued strength across fixed income and equity. Source: earnings call transcript	$51B Long-term net inflows were $51 billion, largely driven by continued strength in fixed income. Source: earnings call transcript	+2%

Operating figures the company stated on at least two of the calls shown, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Risks & headwinds

Higher expenses Q3 FY26

Up 12% YoY to $27.3 billion

Mitigation:Management is still in the budget cycle for next year's expenses, but current consensus for 2027 ($114 billion) is not far off their preliminary read.

Potential impact of sustained high real interest rates on the economy and consumer Long-term

If rates remain high for a long time, it's designed to slow economic activity and fight inflation, which would impact the consumer.

Mitigation:The consumer is currently very healthy due to a strong labor market. JPM prepares for all different events and scenarios.

AI agent disruption and "rogue agents" Ongoing

Potential for misuse and liability transfer if clients use agents with credential sharing.

Mitigation:JPM prioritizes client protection, blocking insecure credential sharing methods, and building tools to ensure secure usage. They will not allow external agents inside the company if too risky.

Credit tightening and erosion of credit terms Current

Some credit terms have "got a whole build those" (likely "gone too far"), with "too much vehicle to we covenants at too much priming."

Mitigation:JPM is tightening up on credit and does not feel the need to chase aggressive terms.

Hedge fund and leverage finance systemic risk Ongoing

Hedge fund industry has grown dramatically and is seen as a systemic risk by IMF; leverage finance also highlighted.

Mitigation:JPM acknowledges these are known risks, and the business involves knowing and managing them. Hedge funds are increasingly institutionalized with professional risk management. Recent smaller events were handled easily by the Street.

Concentration risk in hyperscaler financing Future

Massive CapEx needed for hyperscaler build-out, raising questions about market digestion and concentration limits.

Mitigation:JPM manages single issuer concentration, performs nuanced credit analysis, and uses diversified financing sources. Current exposures are modest, but the firm runs stress tests for resilience to sentiment changes across the enterprise.

Corporate credit pressures Ongoing

Higher energy prices, fuel inputs, and interest rates create challenges in different pockets of the economy (C&I, CRE).

Mitigation:Corporate balance sheets are generally in good shape, showing resilience so far, but pressures are building.

What to watch in Q4 FY26

FY27 NII ex Markets guidance refinement

Next quarter

Current Central case of approximately $107 billion

Target Refined guidance for FY27 NII ex Markets

Why it matters

This is a key forward-looking metric for the bank's profitability, and management explicitly stated it would be refined.

you'll note we gave you a central case for 2027 NII ex Markets of approximately $107 billion, which will refine for the next quarter.

Find out whether JPM delivers this. Inve re-checks your case every morning.

Q&A highlights

How does JPM view the disruption risk from agentic AI (e.g., Smart Cash) and the challenges of deploying it internally given "rogue agents"?

Smart Cash is a small, early-stage pilot. Agentic AI is an intersection of yield-seeking flows and FinTech competition, which JPM has long addressed. The firm is not complacent and is spending time on it. Internally, agents are used for good, but external agents are risky due to potential "rogue agents" and liability issues. JPM prioritizes client protection and is building tools for this.

“In the meantime, we're not going to allow just any agent to come outside Asia to come in inside the company because it's just too risky for clients and for JPMorgan.”

asked by Ebrahim Poonawala · answered by James Dimon

2 min read 6 chapters

Detailed narrative

AI Strategy and Risk Management

JPMorgan Chase is actively exploring and implementing AI internally for productivity gains and for customer-facing applications, such as the Smart Cash solution pilot. The firm acknowledges the competitive landscape from agentic AI and FinTechs but emphasizes its focus on primary bank share and robust customer experiences.

Internally, the bank is cautious about deploying agentic AI due to risks like "rogue agents" and prioritizes client protection, building tools to ensure secure usage and liability clarity.

Capital Allocation and Organic Growth

The company is prioritizing organic growth investments over share buybacks, citing opportunities to redeploy capital at very good returns. This strategy is driven by the belief that the world needs more capital and advice, with initiatives like the security resiliency initiative (SRI) already deploying significant capital. This shift reflects a long-term view on value creation, even if it means a temporary reduction in buyback activity.

Economic Outlook and Consumer Resilience

Management prepares for various economic scenarios, including higher interest rates, but does not predict them. The consumer remains resilient, primarily due to a healthy labor market, with strong debit and credit spend growth. However, sustained high real rates could eventually impact economic activity and consumer credit, leading to higher unemployment.

Deposit Dynamics and Competition

Consumer deposit growth remains strong, driven by net new checking account acquisitions (650,000 this quarter). While the firm expects some internal migration to higher-beta products and potential outflow pressure in a rising rate environment, the core franchise performance is robust. Wholesale deposits are noted as more competitive, with the bank leveraging its comprehensive service offering to win mandates.

Credit Quality and Wholesale Outlook

The corporate credit outlook is stable, with reserve builds primarily attributed to new activities rather than downgrades. While corporate balance sheets are generally strong, management acknowledges potential challenges from higher energy prices, fuel inputs, and interest rates, which could impact C&I and CRE sectors. The firm is tightening credit terms in certain areas, particularly where covenants have eroded.

Regulatory Environment and Liquidity

JPMorgan Chase supports regulators reviewing liquidity rules, including the discount window and FHLB, to create safer banks with more deployed capital and liquidity. The firm maintains a fortress balance sheet with substantial cash and marketable securities, emphasizing that deposit stability should stem from client confidence rather than difficulty in moving funds.

They also acknowledge the need for regulators to consider the impact of new technologies like AI on market stability.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.