Q3 earnings brief: TSMC leads on AI demand, CSX and Interactive Brokers top estimates
Third quarter reporting is in full swing. Consensus expects S&P 500 EPS growth of 7.9% year over year, the ninth straight quarter of gains, but slower than Q2's 12% pace, per FactSet.
Semiconductors: TSMC raises 2025 outlook on persistent AI orders
TSMC reported a 39% jump in profit and lifted its 2025 revenue outlook to mid-30% growth as AI demand stays firm. Q3 revenue reached NT$989.92 billion (about $32.2 billion), above estimates. EPS came in at NT$17.44 ($2.92 per ADR), beating $2.60 expected.
Management cited continued strength in leading-edge nodes. With Apple, Nvidia, and AMD as anchor customers, capacity and pricing power remain favorable. IR materials are available at TSMC investor relations.
Brokers and trading: Interactive Brokers benefits from higher activity
Interactive Brokers posted EPS of $0.59 vs. $0.53 expected on revenue of $1.65 billion vs. $1.52 billion. Client accounts rose 32% to 4.13 million, driving commissions up 23% to $537 million and net interest income up 21% to $967 million.
Management flagged more dip-buying and participation in rallies. Engagement and balances are trending up, a positive setup if volatility persists.
Freight: CSX offsets coal weakness with intermodal and pricing
CSX delivered EPS of $0.44 vs. $0.42 expected. Revenue fell 1% to $3.59 billion but beat estimates; volume rose 1% to 1.61 million units.
Intermodal gains and selective pricing helped counter lower coal prices and softer merchandise volume. Operating margin contracted to 30.3% from 37.4% a year ago, keeping cost control and mix in focus.
Wall Street: dealmaking and trading lift the majors
Large banks continued to outperform. Bank of America's net income rose 23% to $8.47 billion on stronger capital markets.
Morgan Stanley profits surged 45%. Investment banking fees jumped 44% to $2.1 billion, aided by marquee transactions, while client trading revenue rose 24% with combined equities and FICC at $6.28 billion.
Regionals: solid beats with cautious guidance
U.S. Bancorp reported net income of $2.00 billion ($1.22 per share), topping estimates. Revenue hit a record $7.3 billion; net interest income increased 2% to $4.25 billion. Credit provisions rose 2.5% to $571 million.
Elsewhere, regional bank stocks slipped post-prints. PNC beat with EPS of $4.35 vs. $4.04 but guided Q4 net interest income up 1.5% with fee income down ~3%. First Horizon noted a $52 million year-over-year deposit decline.
Brokerages: Schwab posts record revenue and stronger margins
Charles Schwab delivered EPS of $1.26, a penny above consensus. Revenue hit a record $6.13 billion, up 27% year over year.
Client assets grew 17% to $11.59 trillion. Net interest margin expanded 21 bps to 2.86%, supported by lower high-cost funding, strong securities lending, and increased client borrowing.
Airlines: United guides above Street as premium demand holds
United Airlines posted adjusted EPS of $2.78 vs. $2.66 expected on revenue of $15.2 billion, a slight miss. Capacity (ASMs) reached 87.42 billion vs. 86.51 billion expected; PRASM was 73.77 billion vs. 72.71 billion expected.
Q4 EPS guidance of $3.00-$3.50 topped $2.82 estimates. Premium product and tech upgrades continue to support yield and loyalty.
Healthcare and insurance: mixed prints
Abbott reported diluted EPS of $0.94 vs. $1.04 expected on $11.3 billion of revenue, roughly in line. Nutrition grew 4.2% overall (international +13.3%, U.S. -6.5%), Diagnostics fell 6.6%, Established Pharmaceuticals rose 7.5%, and Medical Devices climbed 14.8%.
Progressive missed with EPS of $4.44 vs. $5.30 and revenue of $21.3 billion vs. $21.6 billion; net income fell 48% year over year. A 2023 Florida policy change triggered a $950 million September expense and may lead to profit credits to Florida auto policyholders if statutory limits are exceeded.
What it means for your positioning
- Semis: AI-driven demand is intact. Watch TSMC node mix, capex cadence at hyperscalers, and any signs of lead-time normalization.
- Brokerages: Higher client activity and balances support earnings leverage. Sensitivity to rate moves and volatility remains a tailwind.
- Rails: Intermodal is improving, but coal remains a drag. Margin discipline and pricing mix are key to 2026 expectations.
- Banks: Capital markets are re-accelerating. For regionals, track net interest margin stabilization, deposit costs, fee trends, and provision creep.
- Airlines: Premium and corporate demand are holding up. Capacity management and loyalty monetization should drive Q4 yield.
- Healthcare/Insurance: Devices strong; diagnostics normalizing. Regulatory and reserve dynamics can swing insurer results quarter to quarter.
What's next on the calendar
Investors are watching updates from names including Johnson & Johnson, Domino's, Albertsons, Progressive, Abbott, Prologis, Marsh & McLennan, Infosys, American Express, Truist, State Street, and Ally Financial.
Resources
- Consensus context: FactSet Earnings Insight
- For finance teams evaluating AI exposure and tooling: AI tools for finance
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