Schwab first quarter 2021 earnings


Pedestrians pass in front of a Charles Schwab bank branch in downtown Chicago, Illinois.

Christopher Dilts | Bloomberg | Getty Images

Retail investing behemoth Charles Schwab added more clients in the first three months of 2021 than in all of 2020.

Schwab added a record 3.2 million new clients in the first quarter of 2021. That compares with about 2.4 million new accounts added in all of 2020. Last year’s number excludes 14.5 million new brokerage accounts from the TD Ameritrade merger and 1.1 million accounts obtained from the sale of USAA’s brokerage portfolio to Schwab in May. 

Schwab said it now operates nearly 32 million brokerage accounts and holds about $7.07 trillion in client assets. Shares of Schwab dipped nearly 4% around 10:18 a.m. ET Thursday.

Daily trades at the brokerage rose to an average of 8.4 million, with a single-day peak of 12.3 million. This is four times the trading levels of 2019, when Schwab dropped commissions on these transactions.

“Elevated interest in technology and other growth-oriented stocks, as well as heightened market attention to certain names via social media, significantly bolstered trading activity,” CEO Walt Bettinger said in a company release.

In January, the major brokers were embroiled in an epic short squeeze in GameStop, which was partially fueled by Reddit-driven retail investors. The trading mania drove millions of new retail investors into the market on platforms like Schwab, Robinhood and Interactive Brokers. Schwab said mobile and web logins topped 1.1 billion in the first quarter.

“We have seen multiple days where we handled at least 10 million trades and concurrently accommodated more than 15 million logins across mobile and web,” Bettinger said.

Schwab and the other major brokers are coming off of a banner year in 2020, when a record number of investors entered the market during the Covid-19 pandemic.

Schwab beat expectations on the top and bottom lines of its latest quarterly results. The company earned an adjusted 84 cents per share, topping a Refinitiv forecast of 82 cents per share. Schwab’s revenue came in at $4.72 billion, surpassing an estimate of $4.6 billion. Trading revenue grew 46% quarter-over-quarter to $1.2 billion.

Charles Schwab’s stock is up nearly 30% in 2021.

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