- HSBC’s EPS of $1.60 missed the estimated $1.80, but revenue exceeded expectations with $17.7 billion against an estimated $17 billion.
- The bank’s pre-tax profit, excluding notable items, exceeded consensus by 9%, driven by increased net interest income and reduced impairments, with a CET1 capital ratio of 14.9%.
- Management projects banking net interest income to reach at least $45 billion in 2026, with costs expected to rise by just 1%, indicating strong revenue growth and cost control.
HSBC Holdings PLC, listed on the NYSE:HSBC, is Europe’s largest bank, offering a wide range of financial services, including personal, commercial, and investment banking. Competing with other major financial institutions like Barclays and Lloyds Banking Group, HSBC’s recent earnings report on February 25, 2026, revealed an EPS of $1.60, which fell short of the estimated $1.80. However, the company exceeded revenue expectations, reporting $17.7 billion against an estimated $17 billion.
Despite the EPS miss, HSBC’s strong fourth-quarter performance has garnered analyst support. UBS noted that the bank’s pre-tax profit, excluding notable items, exceeded consensus by 9%. This was driven by increased net interest income and reduced impairments. The CET1 capital ratio of 14.9% also surpassed expectations by 20 basis points, indicating a strong capital position.
Jefferies highlighted that HSBC’s adjusted Q4 pre-tax profit benefited from deposit growth and higher interest rates in Hong Kong. However, approximately $100 million of these gains are not expected to recur. The wealth segment performed well, with fee and other income rising by 20% year-on-year, and invested assets increasing by $80 billion compared to the previous year.
Looking ahead, HSBC’s management projects banking net interest income to reach at least $45 billion in 2026, surpassing the consensus of $43.5 billion. Costs are expected to rise by just 1%, suggesting a cost base of approximately $33.8 billion, which is around $500 million better than market forecasts. This indicates a focus on cost control while driving revenue growth.
HSBC’s financial metrics reflect its market position. The bank has a P/E ratio of approximately 18.22, indicating how the market values its earnings. The price-to-sales ratio is about 2.36, and the enterprise value to sales ratio is around 1.27. With a debt-to-equity ratio of about 0.51, HSBC maintains a moderate level of debt compared to its equity, showcasing financial stability.
