Capital One Financial Stock Earnings Reports

Capital One reported Q1 2026 earnings of $2.2 billion ($3.34 diluted EPS) with adjusted EPS of $4.42 after acquisition- and purchase-accounting impacts. Revenue was down 2% sequentially while noninterest expense fell 9%, driving sequentially higher pre-provision earnings (+8% reported, +6% adjusted). Provision for credit losses was roughly flat at ~$4.1 billion (net charge-offs ~$3.8 billion, allowance build ~$230 million), bringing the allowance to $23.6 billion and total portfolio coverage to 5.28%. Domestic Card showed volume and loan growth largely driven by the Discover acquisition (total card purchase volume +40% YoY; excluding Discover ~8%); charge-offs and delinquencies improved YoY and were generally in line with seasonality. Consumer Banking growth was driven by Discover deposit additions and auto originations (+21% YoY); deposit balances rose materially. Commercial banking credit metrics remain stable but with some small, idiosyncratic criticized loan reserve builds. Liquidity was strong at ~$165 billion of liquidity reserves and ~$76 billion cash; preliminary LCR ~166%. Net interest margin was 7.87% (down 39 bps QoQ), driven by seasonality (fewer days), seasonal card paydowns, and elevated cash balances tied to deposit growth and the Discover home loans sale; management expects cash to decline from the elevated level and that the post-Discover structural NIM level should persist outside seasonal swings. CET1 ended the quarter at 14.4% after $2.5 billion of buybacks; Capital One closed Brex after quarter-end (cash consideration ~$4.5B) and expects the Brex acquisition to reduce CET1 by a little over 40 bps in Q2. Management reaffirmed they remain on track for Discover integration and the $2.5B synergy target by integration completion (mid-2027), but that expense synergies are backloaded and many strategic investments (including Brex and bringing travel tech in-house) will increase near-term investment spending and weigh on efficiency metrics. Management emphasized a long-term, technology-led investment strategy (cloud, data, AI) to drive future growth and earnings power, and they continue to balance investment with capital return (repurchases) while maintaining a conservative capital posture amid regulatory and macro uncertainty.