Schwab profits down 63% in the first quarter
This result was hinted at from the world's largest online broker last month when it announced it was laying off up to 13 per cent of its workforce. Operating income for the quarter was $120 million, down from the $323 million posted for the same quarter last year.
Interestingly, there was a net inflow of customer assets of $31 billion into the company taking total funds under management to $806 billion. Revenue earned from managing investor's money rose by 10%.
As if we needed further evidence of the slowdown in equity markets over the last year. It is interesting to note that although online brokers have attempted to diversify their revenue streams this strategy is not enough to compensate for reduced trading volumes.