Morgan Stanley revenue tops estimates, but CEO warns of geopolitical, economic risks ahead

Morgan Stanley reported better-than-expected fourth-quarter revenue, driven by strong performance in investment banking. The bank’s earnings per share were 85 cents, falling short of the $1.01 expected. However, revenue came in at $12.90 billion, surpassing the expected $12.75 billion. Shares of Morgan Stanley initially rose but later traded down 4%. The bank’s investment banking revenue increased by 5% compared to the previous year, mainly due to a 25% rise in fixed income underwriting revenue. Net income declined by over 30% due to two one-time regulatory charges. This is the first earnings report under new CEO Ted Pick, who emphasized the firm’s clear business strategy and long-term financial goals. Pick also highlighted two potential downside risks in 2024: intensifying geopolitical conflicts and the state of the U.S. economy. Wealth management delivered slightly higher net revenue for the quarter, while revenue from investment management remained relatively unchanged.