As of 8:45 PM IST, Tuesday 27 October 2026. Share moves are intraday figures as reported during Tuesday's session; the London close had not been published at the time of writing.
HSBC shares suffered their sharpest fall in more than 18 months on Tuesday after Europe's largest bank reported third-quarter revenue that fell short of expectations, overshadowing a 32% jump in pre-tax profit and a fresh share buyback of up to $1 billion.
The numbers
According to CNBC, citing consensus estimates compiled by the bank:
- Pre-tax profit: $9.63 billion, up 32% from a year earlier, against $9.69 billion expected.
- Revenue: $18.6 billion, up from $17.8 billion a year earlier, but below the $18.93 billion expected.
- Net interest income: $9.3 billion, helped by deposit growth and reinvesting its structural hedge at higher yields.
- Operating expenses: down 12% to $8.8 billion, mainly because a year-earlier quarter included $1.4 billion of legal provisions.
- Shareholder returns: a buyback of up to $1 billion and a third interim dividend of 10 cents per share.
The profit jump largely reflects the absence of those legal provisions, along with higher revenue and lower credit losses. Excluding notable items, costs rose because of inflation and higher technology spending, CNBC reported.
Why the shares fell
HSBC's London-listed shares fell about 6.5% in early trading, putting them on course for their worst session since 3 April 2025, CNBC reported. In Hong Kong the stock closed down 2.95% after the results. Investing.com said the London shares were down more than 6% later in the session, citing slowing wealth revenue and rising costs, and that the fall helped drag the FTSE 100 lower.
Citi analysts called it a "mixed set of results", pointing to a roughly 2% revenue miss but also an 18.8% year-to-date return on tangible equity, well ahead of the bank's medium-term guidance of around 17%. Search-based summaries put wealth revenue roughly flat at about $2.7 billion; HorizonDesk has not independently confirmed that figure against the bank's release.
Guidance unchanged
HSBC kept its 2026 forecast for banking net interest income of at least $46 billion and reiterated a target return on average tangible equity of 17% or more for each year from 2026 to 2028, excluding notable items. It expects revenue to grow every year through 2028, targeting 5% growth in 2028 over 2027 on a constant-currency basis excluding notable items.
The bank said it remains on track for operating expense growth of about 1% in 2026 on a target basis, but warned that strong business performance could lead to extra performance-related pay and modestly higher cost growth. It also said it expects to complete a further $1 billion of buybacks before its full-year results.
Job cuts reported
Separately, HSBC is reported to be considering significant job cuts in its UK wealth management business as part of a wider push to adopt artificial intelligence, CNBC said. The bank has not announced any such cuts.
What to watch
- Whether the London share price recovers before Tuesday's close.
- Commentary on wealth revenue and cost growth in the full results release.
- The European Central Bank and Federal Reserve decisions later this week, which will shape rate expectations for banks' interest income.
Related reading on HorizonDesk
- American Express cuts 5% of jobs as AI reshapes finance
- UK inflation at 3.5% and the Bank of England rate-hike debate
- Great financial crises: the 2023 banking turmoil
Sources
- CNBC: HSBC shares slump on revenue miss, lender announces buyback
- HSBC Holdings: 3Q 2026 earnings release (PDF)
- Investing.com (Reuters): European shares fall as HSBC slump and energy fears offset AI glow
Disclaimer: This article is for information only and is not investment advice or a recommendation to buy, sell or hold any security. HorizonDesk is not registered with SEBI as an investment adviser or research analyst. Please consult a SEBI-registered professional before making investment decisions.
