Global financial services company Wells Fargo has warned of an economic slowdown caused by the United States trade war.
Chief Executive Officer Charlie Scharf commented after announcing an increase in first quarter (Q1) earnings.
“We expect continued volatility and uncertainty and are prepared for a slower economic environment in 2025, but the actual outcome will be dependent on the results and timing of the policy changes,” Scharf said in a media release.
“We and our customers come into the current environment from a position of strength that should serve us well.
“We are prepared for a variety of outcomes, our focus is unwavering, and we will continue transforming Wells Fargo by investing to build a well-controlled, faster-growing and a higher-returning company while we work to better serve our customers and become more efficient.”
Wells Fargo, which started operating stage coaches, said net income increased 6% to US$4.894 billion (A$7.89 billion) and diluted earnings per share (EPS) surged 15.8% to $1.39 despite revenue dropping 3.4% to $20.149 billion in the three months ended 31 March 2025.
Scharf said Wells Fargo produced solid results with the EPS increase reflecting fee-based revenue growth across many core businesses, expense discipline, improved credit results and an 8% reduction in diluted common shares as it continued to return capital to shareholders.
“I am excited about the momentum we are building across our businesses as we work to build one of the most respected financial institutions in the country,” he said.
He said although Wells Fargo supported the United States administration’s willingness to look at barriers to fair trade for the United States, there were risks associated with such significant actions.
“Timely resolution which benefits the U.S. would be good for businesses, consumers, and the markets,” Scharf said.
The result beat analysts’ expectations of EPS of $1.24 based on estimates compiled by LSEG, according to Reuters.
But Wells Fargo (NYSE: WFC) shares closed 60 cents or 0.95% lower at $62.51 on Friday, capitalising the company at $204.11 billion.
Founded in 1852 during the California gold rush, Wells Fargo started operating horse-drawn stagecoaches to transport gold, mail, freight, and passengers.