NEW YORK — Morgan Stanley said Thursday its revenue fell sharply in the second quarter, dragged down by weak results from its investment banking unit. Its net income missed Wall Street expectations, and its stock dropped sharply.
The bank brought in 24 percent less revenue overall, but the decline was especially evident in investment banking, where revenue plunged 37 percent.
In that unit, revenue from advising businesses was down by half. Bond and commodities sales and trading was down by nearly 60 percent. Stock sales and trading fell nearly 40 percent.
In a statement, CEO James Gorman described the April-June period as “an environment marked by investor caution.”
The bank earned US$564 million for the quarter, a swing from a loss of US$558 million in the same period last year. In last year’s second quarter, Morgan took big charges so it could cut down on expensive dividend payments to Mitsubishi UFJ Financial Group, a Japanese financial firm that gave the bank a life-sustaining cash infusion in the depths of the 2008 financial crisis.
Earnings came to 29 cents per share, lower than the estimate of 32 cents from analysts surveyed by FactSet, a data provider.