Market Volatility+SpaceX Listing Attracts an influx of retail investors! Trading frenzy helps Charles Schw.US (SCHW.US) Q2 results exceed expectations

The Zhitong Finance App learned that due to market fluctuations caused by geopolitical uncertainty, compounded by retail investors continuing to enter and exit the market, leading US online brokerage firm SchW.US (SCHW.US) announced second-quarter results that were better than market expectations. Financial reports showed that net revenue for the second quarter of Carson Wealth Management increased 21% year over year to US$7.072 billion, better than analysts' average forecast of US$6.92 billion; adjusted net profit was US$2,930 million, up 32% year over year; adjusted earnings per share was US$1.62, better than analysts' average expectation of US$1.55; net interest spread widened 12 basis points to 3.00% month-on-month, and profitability continued to recover.

“Strong customer engagement drove the company's revenue to grow year over year in the second quarter,” said Michael Weldsky, chief financial officer at Carson Wealth Management, in a statement. According to the data, the company's average daily revenue transactions (DARTs) in the second quarter reached a record high of 11.9 million transactions, an increase of 57% over the previous year. Transaction revenue also increased, rising 28% year over year to $1.2 billion.

At the same time, the company continued to attract more capital inflows. Total net new assets surged 61% in the second quarter to reach US$118.7 billion, higher than analysts' expectations of US$111 billion; the net core inflow reached a record high of US$119.8 billion in June, a record high of US$62.7 billion — a year-on-year increase of 47%; 1.4 million new brokerage accounts were added during the period, and the total size of customer accounts expanded to 48 million.

In the second quarter, Carson Wealth Management benefited from the largest initial public offering (IPO) ever — the listing of SpaceX (SPCX.US) in June. CEO Rick Worst said that since retail investors paid close attention to the incident, the day became one of the five busiest trading days in the 55-year history of the company.

Carson Wealth Management is one of the five platforms listed by SpaceX in its IPO prospectus that may provide stock trading channels to retail investors. Other platforms include Robinhood (HOOD.US), Fidelity Investments, SoFi Technologies, and Morgan Stanley's E*Trade. Customers of these platforms received at least one share placement in this IPO.

Worst Zhou previously said in an interview: “If you look back at all the market events we've experienced over the past 50 years, it's really incredible that SpaceX's IPO was in the top five. I think the reason behind this is that retail investors can personally feel the level of innovation in the US economy.”

Worst also said that SpaceX has attracted demand from various groups of retail investors, while Carson Wealth Management has received about 140,000 customer calls related to SpaceX's listing. According to reports in early June, on the eve of SpaceX's listing, Carson Wealth Management expanded its IPO team by 10 times.

In addition, Carson Wealth Management officially launched Schwab Crypto, a cryptocurrency trading platform for retail investors, opened Bitcoin and Ethereum transactions, and launched Portfolio Insights, a generative AI tool to help investors analyze position performance. The company's management said that diversified business structures and large-scale advantages combined with continuous product innovation supported strong performance in this round. The market will continue to pay attention to the continued popularity of retail transactions, net interest spread trends, and whether the crypto business and AI tools can further drive medium- to long-term revenue growth. It is worth mentioning that Carson Wealth Management said earlier this year that since competitors including Robinhood and Yingtou Securities are benefiting from predictive market products, the company may launch predictive market products strictly related to financial events.