State Street Corporation (STT) Reports Q3 2023 Earnings, Total Fee Revenue Up 3%

• State Street Corporation (NYSE:STT) reported Q3 2023 EPS of $1.25, $1.93 excluding notable items.

• Total fee revenue increased by 3% year-over-year.

• Record cash net inflows of $41 billion at Global Advisors.

• Returned $1.2 billion of capital through common share repurchases and dividends.

State Street Corporation (NYSE:STT) released its Q3 2023 earnings report on October 18, 2023. The company reported an EPS of $1.25, or $1.93 excluding notable items. The total fee revenue saw a 3% increase year-over-year, supported by Investment Services and asset management. The company also reported record cash net inflows of $41 billion at Global Advisors.

Financial Highlights

The company's total revenue for Q3 2023 was $2,691 million, a decrease of 9% compared to Q3 2022. The net income for the quarter was $422 million, a decrease of 39% year-over-year. The diluted earnings per share (EPS) was $1.25, a decrease of 31% compared to the same period last year.

State Street Corporation (NYSE:STT) also reported a return on average common equity (ROE) of 7.3%, a decrease of 3.9% points year-over-year. The company's pre-tax margin was 19.0%, a decrease of 9.7% points compared to Q3 2022.

Company's Performance and Achievements

Ron O'Hanley, Chairman and Chief Executive Officer of State Street Corporation (NYSE:STT), stated,

In the third quarter, we delivered total fee revenue growth year-over-year, supported by Investment Services, including front office solutions, as well as asset management. We executed on our strategy to refocus our sales efforts within our Investment Services franchise, and generated strong servicing fee revenue wins of $91 million in the quarter, including the first Alpha for Private Markets mandate."

O'Hanley also highlighted the company's ongoing transformation and productivity initiatives, which limited year-over-year expense growth while allowing continued investment in the business. The company returned $1.2 billion to shareholders through common share repurchases and dividends in the third quarter.

Looking Ahead

State Street Corporation (NYSE:STT) intends to continue executing on its common share repurchase authorization of up to $4.5 billion during 2023, subject to market conditions and other factors. The company also expects to generate additional productivity savings in 2024, lower operating costs, and continue to strengthen service quality through the consolidation of one of its operations joint ventures in India.

This article first appeared on GuruFocus.