Truist Beats Q3 Profit Forecasts but Revenue Falls Short

Truist Financial, one of the largest regional lenders in the United States, beat Wall Street’s profit forecasts for the third quarter on Friday, but its headline revenue fell well short of expectations after the bank booked a US$1.45 billion loss on a sweeping overhaul of its bond portfolio, Yahoo Finance reported.

The bank posted adjusted earnings of US$1.16 a share, up 12% from US$1.04 a year earlier and ahead of the consensus estimate of about US$1.14 cited by Yahoo Finance and Investing.com. On a reported basis, however, earnings dropped to US$0.56 a share, and net income slid to US$799 million from roughly US$1.45 billion in the same quarter of 2025, according to the bank’s earnings filing.

Reported revenue came in at US$3.75 billion against analyst expectations of around US$5.35 billion. Stripping out one-off items, adjusted revenue on a taxable-equivalent basis was broadly flat at about US$5.30 billion.

A quarter of clean-up moves

The gap between the two sets of numbers comes from a series of deliberate balance-sheet actions. Truist sold available-for-sale securities at a pre-tax loss of about US$1.45 billion, equal to US$0.90 a share, as part of a repositioning of its securities book. It also completed the sale of roughly US$5.5 billion of auto loans from its Regional Acceptance Corporation unit, which carried about US$106 million of pre-tax costs. Partly offsetting those hits was a US$581 million release of loan-loss reserves.

Chief financial officer Mike Maguire told analysts on the earnings call, according to an Investing.com transcript, that the strategic actions cut reported earnings by a net US$0.60 a share.

Chief executive Mike Lyons, presenting his first quarterly results in the role, described the steps as “decisive actions to better position Truist for the future” in the company’s release. On the call he struck a confident note, telling analysts: “We do not need to reinvent Truist to win from here.”

Core business holds steady

Underlying trends were steadier. Taxable-equivalent net interest income rose 1.1% from the previous quarter to about US$3.71 billion, while the net interest margin edged up two basis points to 3.00%. Wealth management delivered record quarterly income of US$407 million. Period-end deposits grew to US$413.2 billion, and nonperforming loans fell to 0.40% of loans held for investment.

Net charge-offs rose to 0.77% of loans, although 39 basis points of that figure related to the auto-loan sale. The bank’s preliminary common equity tier 1 capital ratio stood at 10.7%, down from 10.9% three months earlier. Truist returned about US$1.8 billion to shareholders through dividends and buybacks during the quarter.

Investors gave the results a cautious reception, with the shares slipping in pre-market trading on Friday as the revenue miss drew attention, according to Yahoo Finance and Investing.com.

What comes next

Further restructuring is on the way. Truist said it signed an agreement on 14 October to sell US$7.7 billion of unsecured consumer loans, essentially all of the assets of its LightStream lending business, to Carlyle. According to the earnings call, the deal is expected to close in the fourth quarter and generate around US$7.2 billion in net proceeds.

For the final quarter of 2026, management guided for revenue of about US$5.35 billion and net interest income of US$3.65 billion to US$3.70 billion, alongside roughly US$1 billion of share repurchases. The bank is targeting a 15% return on tangible common equity in 2027 and plans to give a fuller outlook early next year.

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