Shares in Wells Fargo & Co (NYSE:WFC, ETR:NWT) traded 6.3% higher on Wednesday afternoon on the back of earnings that beat Wall Street predictions and CEO Charlie Scharf saying the bank is "still in the early stages" of its transformation.
Adjusted earnings per share for the fourth quarter of $1.42, up 1% on the preceding quarter last year and up 66% year on year, while beating the consensus forecast of $1.35, per LSEG.
Revenues of $20.38 billion, however, were below the $20.59 billion expected, and roughly flat sequentially and year-over-year.
The increase in earnings benefited from exiting or scaling back less profitable businesses, decreasing reliance on net interest income by growing fee-based revenues, increase investments in our core businesses, and finding efficiencies.
Last year net interest income declined 9% but this is expected to reverse, with guidance for this to rise between 1% to 3% in 2025.
Scharf called the past quarter's performance as "solid", but one that "caps a year of significant progress for Wells Fargo", including returning $25 billion of capital to shareholders.
"I’m excited about the opportunities ahead as we’ve seen improved results and increased market share in many of the businesses that we believe will drive higher growth and returns over time," he said.
"I believe we are still in the early stages of seeing the benefits of the momentum we are building, and our financial performance should continue to benefit from the work we are doing to transform the company."