Morgan Stanley reports record $232 billion wealth inflow in third quarter

Morgan Stanley reported third-quarter 2026 total revenue of $20.34 billion on Wednesday, driven by record asset inflows in its wealth management arm and strong stock trading revenue.

The bank posted third-quarter net income of $4.97 billion, up from $4.66 billion in the same period a year earlier, according to its financial statement. Wealth management revenue rose to $9.1 billion, compared with $8.2 billion a year prior.

Net new assets in the wealth management division reached a record $232 billion for the quarter, more than double Wall Street consensus forecasts. The surge brought total wealth management assets under management to $8.4 trillion.

Half of the new wealth assets, or $116 billion, came directly from recent initial public offerings. The bank cited SpaceX, which uses Morgan Stanley's workplace channel for employee equity compensation and retirement plans, as a major driver of asset flows following its stock market listing.

“Should this IPO market continue over the next 12 months, we expect to continue to benefit from it,” Chief Financial Officer Sharon Yeshaya said in an interview. She added that upcoming lockup expiries from big public listings are expected to support asset growth in future quarters, though clients may convert some stock into cash.

Stock trading generated $5.8 billion in revenue, exceeding analyst expectations of $4.9 billion. Overall trading revenue hit $7.81 billion, above expectations of $7.31 billion. Higher interest rates weighed on fixed income trading, while stock desks benefited from volatility-driven client demand.

Investment banking revenue rose to $2.16 billion from $2.11 billion a year earlier. Yeshaya noted that deal pipelines are building following a brief slowdown in September.

Revenue in the investment management division declined year-over-year. Co-president Dan Simkowitz previously noted that the decline stemmed from a reversal of a couple hundred million dollars in unrealized carried interest linked to two European assets in an infrastructure fund.

Shares of Morgan Stanley fell 2.2 percent in early New York trading on Wednesday, after rising 5.1 percent through Tuesday.