Truist Q3 2026: EPS $1.16 Beats by $0.02, but Securities Losses Cut Net Income 45%

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Truist Financial (TFC) reported third-quarter adjusted EPS of $1.16 on Oct. 16, 2026, above the $1.14 analysts expected. Revenue as tracked by our data provider came in at $3.75B against a $5.35B estimate, and reported net income fell 45.0% from a year earlier to $799.0M. The gap between the headline beat and the weaker reported results is the story: the company is selling businesses and repositioning its securities, and those moves cost money now.

Key facts

• Oct. 16, 2026: Truist reported EPS of $1.16 versus a $1.14 estimate, a $0.02 (1.8%) beat. Our data provider shows revenue of $3.75B versus a $5.35B estimate, a miss of $1.61B (30.0%).
• Third quarter ended Sept. 30, 2026: Reported (GAAP, meaning unadjusted) revenue was $6.11B, down 22.1% from $7.84B a year earlier. Net income was $799.0M, down 45.0% from $1.45B. Diluted EPS was $0.56, versus $0.90 a year earlier.
• Oct. 16, 2026: The stock closed the latest quote at $47.07, up 1.07% on the day. Its 52-week range is $42.70 to $56.20.
• Next report: Jan. 20, 2027, with consensus EPS of $1.21 and revenue of $5.34B.

| Metric | Q3 FY2026 | Year-ago Q3 FY2025 / estimate | |---|---|---| | Adjusted EPS | $1.16 | $1.14 estimate | | Revenue (data provider basis) | $3.75B | $5.35B estimate | | Revenue (reported) | $6.11B | $7.84B | | Operating income | $895.0M | $1.74B | | Net income | $799.0M | $1.45B | | Diluted EPS (reported) | $0.56 | $0.90 | | Operating margin | 14.6% | 22.1% |

What happened

Two EPS numbers. The $1.16 figure is "adjusted" EPS, which strips out one-time items. The company said that figure was up from a year ago. The $0.56 diluted EPS is the unadjusted number. The difference is mostly large losses booked on selling securities (the company's available-for-sale bond portfolio), which management said it took as part of repositioning the balance sheet.

Two revenue numbers. Our data provider lists revenue of $3.75B against a $5.35B estimate, but the reported quarterly revenue was $6.11B. For context, the call transcript reports about $1.4B of losses on the securities sold plus $66M of losses from the RAC sale in non-interest income. That roughly matches the gap between the $3.75B figure and the $5.35B estimate, but we can't confirm that it explains the difference. Treat the 30.0% "miss" with caution. The reported year-over-year decline of 22.1% also includes those losses. Notably, management's guidance for next quarter's revenue is about $5.35B, the same as the estimate figure.

What drove the quarter. According to the call, the company said:

• Wealth management had its best quarter ever, helped by favorable stock markets.
• Net interest income (what a bank earns on loans minus what it pays on deposits) rose from the prior quarter, helped by older fixed-rate assets repricing higher. The net interest margin edged up.
• Average deposits grew from the prior quarter and from a year ago.
• Adjusted expenses were nearly flat from the prior quarter.

On the weaker side, management said investment banking revenue was pushed out late in the quarter amid market volatility. Average loans fell $3.6B, which management tied to its deliberate focus on risk-adjusted returns, about $2.7B of strategic runoff, and the move of the RAC portfolio to held-for-sale, along with higher-than-expected paydowns. Problem commercial loans rose, merchant card fees weakened, and trading and M&A activity declined.

The strategy behind it. CEO Mike Lyons said: "We have all the raw materials to become one of the country's top-performing banks, and this is our overwhelming number 1 objective." He also said: "our strategy is not about shrinking to achieve higher returns. It's about creating a stronger foundation for both sustainable growth and higher returns over time." The sale of the RAC auto loan portfolio ($5.5B) closed at the end of the third quarter. Truist has also signed an agreement to sell LightStream, which it expects to close in the fourth quarter and which is excluded from fourth-quarter guidance. CFO Mike Maguire called RAC roughly break-even, and put the full-quarter net interest income impact of the LightStream sale at about $95 million. Management acknowledged Truist has underperformed its goals from the merger that created it.

Five-quarter trend. Quarterly operating margin (the share of revenue left after operating costs) was 22.1% in the quarter ended Sept. 30, 2025, then 20.4%, 22.8% and 23.8% in the next three quarters. It fell to 14.6% in the latest quarter. Revenue ran between $7.41B and $7.84B for four quarters before dropping to $6.11B. Net income went from $1.45B to $1.35B, $1.48B and $1.55B, then to $799.0M. The latest quarter breaks a period of fairly stable results, and the cause is mostly the one-time securities losses.

Cash returns. Operating cash flow was $1.50B, $2.58B, $679.0M and $1.04B in the four quarters ended Sept. 30, 2025 through June 30, 2026. Our data does not yet show the latest quarter's cash flow. Buybacks over those quarters were $500.0M, $1.75B, $1.13B and $1.20B. Dividends paid slipped from $665.0M to $636.0M. Management said it is cutting fourth-quarter buybacks, citing interest rates and its strategic review.

Why it matters for investors

Valuation. On trailing 12-month earnings, TFC trades at a price-to-earnings ratio (price divided by per-share profit) of 11.98, with a dividend yield of 4.4% and a net margin of 18.0%. Peers:

| Bank | Market cap | P/E | Net margin | |---|---|---|---| | Truist (TFC) | $57.50B | 11.98 | 18.0% | | Fifth Third (FITB) | $45.68B | 17.02 | 15.8% | | Huntington (HBAN) | $30.85B | 11.23 | 16.6% | | KeyCorp (KEY) | $21.58B | 11.55 | 19.4% | | Citizens (CFG) | $26.69B | 12.67 | 19.5% |

Truist sits in the middle of the group on price and slightly below the top on profit margin. Its debt-to-equity ratio is 1.07, with total debt of $65.79B against shareholders' equity of $61.47B. Debt works differently for banks, because deposits and borrowing are part of their business.

Analysts. The consensus rating is "Buy": 27 buy, 24 hold and 3 sell ratings. The average price target is $55.13 (median $55.00), with a range of $50.00 to $62.00. The share price of $47.07 is below the lowest target, but targets are opinions and often lag events. In the last 30 days, UBS kept a Neutral rating, JP Morgan kept Underweight, and Evercore ISI kept Outperform. Over the past 90 days, insiders made one open-market purchase and two sales.

Our MoonshotScore. Stock Expert AI's MoonshotScore V2 for TFC is 83.1 ("Exceptional"). Its pillars, measured against other companies in the same sector, are:

• Growth: 99 (very strong)
• Valuation: 96 (very strong)
• Quality: 67 (above average)
• Safety: 43 (below average)
• Momentum: 27 (weak)

In plain terms, the score says the shares look cheap and the growth profile looks good compared with other banks, while price trend and balance sheet safety are weaker. The Piotroski score, a 0-to-9 measure of financial health, is 7. The Altman Z score is 0.21, but that measure was built for industrial companies and tends to look poor for banks, so we don't weigh it heavily.

What could go wrong. Risks include:

• Expenses could rise. Management said "We don't expect there to be some seismic shift in the trajectory of our expense profile," but Lyons also said "We'll naturally grow expenses, whatever the long-term," and Maguire said the word seismic "is not intended to say that there won't be a change in our expense profile."
• Selling businesses shrinks the balance sheet and interest income in the near term. Lyons said the actions "will necessarily reduce the balance sheet," and Maguire put the RAC sale's hit to fourth-quarter net interest income at about $125 million.
• Problem loans in commercial lending rose, which Maguire noted on the call.
• Capital rules that count unrealized bond losses (Basel III and AOCI treatment) were discussed on the call and remain a factor.
• The quarter's margins show how much one-time items can swing results.

The weak momentum and safety pillars point the same way.

What to watch next

• Fourth-quarter guidance. The company guided to net interest income of roughly $3.65B to $3.7B, reduced by the RAC sale and partly offset by the securities repositioning. It also guided to revenue of about $5.35B and said charge-offs (loans written off) should follow normal seasonality.
• Jan. 20, 2027 report. Analysts expect EPS of $1.21 and revenue of $5.34B. Management said it will detail its full 2027 outlook, and its review of which businesses to keep, in January.
• Returns targets. The CFO said the long-term target for return on tangible common equity, a measure of profit per dollar of shareholder capital, is unchanged, and that the cost-efficiency ratio could improve from its current level.
• Further out. Analyst estimates for the periods ending March 30 and June 30, 2028 show EPS of $1.21 and $1.34, with revenue of $5.57B and $5.63B. Few analysts cover those periods (8 and 4), so treat them as rough.

Frequently asked questions

Q: Did Truist beat earnings expectations in the third quarter of 2026?

On adjusted EPS, yes. Truist reported $1.16 on Oct. 16, 2026, against an estimate of $1.14. Reported (unadjusted) EPS was $0.56, and revenue on our data provider's basis was $3.75B against a $5.35B estimate, so the picture depends on which measure you use.

Q: Why did Truist's net income fall 45% from a year ago?

Reported net income was $799.0M in the quarter ended Sept. 30, 2026, versus $1.45B a year earlier. The company said the quarter included large losses from selling securities as it repositions its balance sheet, and revenue also declined. Management said the underlying business, including wealth management and deposits, performed solidly.

Q: When does Truist report next, and what is expected?

Truist is scheduled to report on Jan. 20, 2027. Analysts expect EPS of $1.21 and revenue of $5.34B. The company said it will give its full 2027 outlook around then.

This article is for information only and is not investment advice.

This is educational content, not investment advice. Past performance does not guarantee future results.

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