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STATE STREET CORP

STT
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Business Summary

State Street Corporation is one of the world’s leading providers of financial services to institutional investors, including investment servicing, markets and financing solutions and investment management. Its clients include asset managers and owners, insurance companies, wealth managers, official institutions and central banks. Through its subsidiaries, including its principal banking subsidiary, State Street Bank and Trust Company, the company operates in more than 100 geographic markets worldwide.

The company operates in a highly competitive environment globally, with competitors including other custodial banks, deposit-taking institutions, investment management firms, insurance companies, mutual funds, broker/dealers, investment banks, benefits consultants, investment analytics businesses, business service and software companies, technology companies, data providers and information services firms. As a G-SIB, State Street is subject to extensive regulation and supervision, and not all of its competitors have similarly been designated as systemically important or are subject to the same degree of regulation. Key competitive factors for the Investment Servicing line of business include technological advances, economies of scale, required levels of capital, pricing, quality and scope of services, and sales and marketing. For the Investment Management line of business, key competitive factors include expertise, experience, availability of related service offerings, quality of service, price, efficiency of products and services, and performance.

State Street generates revenue through fee-based services and net interest income. Total fee revenue represented approximately 79% of total revenue in 2025. The company’s core business model is organized into two lines of business: Investment Servicing and Investment Management. Investment Servicing provides investment servicing and market and financing solutions to institutional clients, including custody, accounting and fund administration services, recordkeeping, client reporting, transaction management, foreign exchange, brokerage and other trading services, securities finance, and deposit and short-term investment facilities. Investment Management provides a comprehensive range of investment management solutions and products, including equity, fixed income, liquidity and cash, multi-asset and alternatives strategies, delivered through products such as ETFs, custom indexed, and actively managed funds and mandates.

The Investment Servicing line of business provides a broad range of investment servicing and market and financing solutions to institutional clients, including mutual funds, collective investment funds and other investment pools, corporate and public retirement plans, insurance companies, wealth managers, investment managers, foundations and endowments worldwide. Services include back-, middle- and front-office solutions, including custody, accounting and fund administration services for traditional and alternative assets, as well as multi-asset class investments; recordkeeping, client reporting and investment book of record, transaction management, loans, cash, derivatives and collateral services; investor services operations outsourcing; performance, risk and compliance analytics; financial data management; foreign exchange, brokerage and other trading services; securities finance, including prime services products; and deposit and short-term investment facilities. The State Street Alpha platform combines portfolio management, trading and execution, analytics and compliance tools, along with advanced data aggregation and integration. As of December 31, 2025, Investment Servicing serviced AUC/A of approximately $53.80 trillion , comprising approximately $37.42 trillion in the Americas, approximately $12.92 trillion in Europe and the Middle East and approximately $3.46 trillion in the Asia-Pacific region. Servicing fees for the year ended December 31, 2025 were $5.324 billion .

The Investment Management line of business provides a comprehensive range of investment management solutions and products for clients through State Street Investment Management. Solutions span across equity, fixed income, liquidity and cash, multi-asset and alternatives strategies, delivered through products such as ETFs, custom indexed, and actively managed funds and mandates. As of December 31, 2025, State Street Investment Management had approximately $5.67 trillion in AUM. Management fees for the year ended December 31, 2025 were $2.398 billion . Total fee revenue for Investment Management was $2.619 billion in 2025.

In 2025, the company acquired PriceStats. The company repurchased $1.2 billion of its common stock during 2025 and declared aggregate common stock dividends of $3.20 per share , totaling $909 million . The company increased the quarterly common stock dividend declared per common share by 11% in the third quarter of 2025. Repositioning charges of $326 million were recorded in 2025, which included $211 million of compensation and employee benefits expenses related to workforce rationalization, $69 million of occupancy costs associated with real estate footprint optimization, and costs associated with operating model changes of $24 million and $22 million reflected in information systems and communications and other expenses, respectively. Other notable items included an FDIC special assessment release of $60 million , partially offset by $40 million of legal and related costs, and an Alpha-related client rescoping of $18 million reflected in information systems and communications expenses.

Total revenue for the year ended December 31, 2025 was $13.944 billion , compared to $13.000 billion in 2024, an increase of 7%. Net income was $2.945 billion in 2025, compared to $2.687 billion in 2024. Diluted EPS was $9.40 in 2025, compared to $8.21 in 2024. Pre-tax margin was 26.8% in 2025, compared to 26.1% in 2024. Return on average common equity was 11.5% in 2025, compared to 11.1% in 2024.

Business Outlook

A key growth vector is the State Street Alpha platform, which combines portfolio management, trading and execution, analytics and compliance tools, along with advanced data aggregation and integration with other industry platforms and providers. The company continues to build solutions to tokenize assets in the digital asset space, with a vision to deliver digital asset solutions to clients as a trusted provider of end-to-end capabilities across the asset servicing lifecycle on a secure, interoperable platform with multiple blockchain connectivity. Newly announced investment servicing mandates totaled approximately $2.12 trillion of AUC/A in 2025. Investment servicing assets remaining to be installed in future periods totaled approximately $2.50 trillion as of December 31, 2025, with approximately 70% expected to be installed in 2026, with the balance expected to be installed largely in 2027.

Another growth vector is the expansion of wealth servicing and alternative investment management. The company is developing new products and services, including those related to wealth servicing, alternative investment management or digital assets or incorporating artificial intelligence. The company also continues to build solutions to tokenize assets. The company’s AUM of $5.67 trillion as of December 31, 2025 increased 20% compared to December 31, 2024, primarily due to higher market levels and net inflows. Total flows, net for AUM were $180 billion in 2025.

Total expenses increased 7% in 2025 compared to 2024, primarily due to higher business and technology investments, revenue-related costs and higher impact of notable items in the current year, partially offset by productivity and other savings. Repositioning charges of $326 million were recorded in 2025. The company is focused on productivity and other savings to offset cost increases.

The company’s employee population at December 31, 2025 decreased approximately 2% to approximately 52,000 employees , compared to December 31, 2024, primarily driven by continued efforts to simplify operations through organization design and technology and automation efforts. Approximately 77% of employees are located outside the United States. The company is investing in technology and infrastructure, with information systems and communications expenses increasing 14% in 2025 compared to 2024, largely driven by higher technology and infrastructure investments.

In 2025, the company returned approximately $2.1 billion to shareholders in the form of common share repurchases and common stock dividends. The company repurchased $1.2 billion of its common stock during 2025, acquiring an aggregate of 11.5 million shares of common stock at an average per share cost of $104.05 . As of December 31, 2025, approximately $2.5 billion was remaining under the 2024 share repurchase authorization. The company declared aggregate common stock dividends of $3.20 per share , totaling $909 million in 2025. The quarterly common stock dividend declared per common share was increased by 11% in the third quarter of 2025.

The company faces significant pricing pressure in many of its core businesses, particularly custodial and investment management services, which has and may continue to impact revenue growth and operating margins. The company is subject to variability in AUC/A and AUM due to the significant size of relationships with many institutional clients, and the loss or gain of one client could have a significant effect. The company is also subject to intense competition, and new market entrants and competitors may have materially greater resources to invest in infrastructure, technology and product development.

The company is subject to extensive and changing government regulation and supervision in the U.S. and non-U.S. jurisdictions, which may increase costs and expose the company to compliance risks. As a G-SIB, the company is subject to enhanced supervision and prudential standards, including capital surcharges, TLAC requirements, and stress testing. The company faces risks related to the implementation of regulatory capital and liquidity standards, including the Basel III framework, and potential changes to these standards, such as the 2023 Basel III Endgame Proposal and the 2023 G-SIB Surcharge Proposal, which are under reconsideration. The company also faces risks from political, geopolitical and economic conditions, including changes in interest rates, monetary policy, and market volatility.

Risk Factors

The company is subject to intense competition and significant pricing pressure in its core businesses, which could negatively affect profitability. Fee revenue, representing approximately 79% of total revenue in 2025, is subject to decline based on market and currency declines, investment activities and preferences of clients, and the timing of new business onboarding. The company assumes significant credit risk of counterparties, many of which are major financial institutions, and these credit exposures and concentrations could expose it to financial loss. As of December 31, 2025, commercial real estate-related allowance for credit losses was $119 million . The company faces extensive and changing government regulation and supervision, and its business and capital-related activities may be adversely affected by regulatory requirements, including capital, credit and liquidity standards. The company is also exposed to operational, cyber and technology risks, including failures of or damage to information technology systems or facilities, which could result in significant costs and reputational damage.

Management Priorities

Management’s tone in the filing is focused on the company’s role as an essential partner to institutional investors, leveraging strength and scale, innovation and platforms, and industry expertise. Key strategic priorities emphasized include the development and marketing of new products and services, including State Street Alpha and those related to wealth servicing, alternative investment management or digital assets or incorporating artificial intelligence. Management also emphasizes the importance of cost initiatives, enhancements and efficiencies to operational processes, and improvements to existing and new service offerings. The filing states that the company’s target ranges for CET1 capital and Tier 1 leverage ratios remain at 10-11% and 5.25-5.75%, respectively. The company’s SCB requirement remains at 2.5% for the period from October 1, 2025 through September 30, 2026, based on the results of the 2025 supervisory stress test.

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 1, Business — Overview
  2. [2] Item 1, Business — Lines of Business, Investment Servicing
  3. [3] Item 1, Business — Lines of Business, Investment Servicing
  4. [4] Item 1, Business — Lines of Business, Investment Servicing
  5. [5] Item 7, MD&A — Consolidated Results of Operations, Fee Revenue, Table 2: Total Revenue
  6. [6] Item 1, Business — Overview
  7. [7] Item 7, MD&A — Consolidated Results of Operations, Fee Revenue, Table 2: Total Revenue
  8. [8] Item 7, MD&A — Line of Business Information, Investment Management, Table 14
  9. [9] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  10. [10] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  11. [11] Item 7, MD&A — Financial Results and Highlights
  12. [12] Item 7, MD&A — Financial Results and Highlights
  13. [13] Item 7, MD&A — Expenses, Repositioning Charges, Table 12
  14. [14] Item 7, MD&A — Expenses
  15. [15] Item 7, MD&A — Expenses
  16. [16] Item 7, MD&A — Expenses
  17. [17] Item 7, MD&A — Expenses
  18. [18] Item 7, MD&A — Expenses
  19. [19] Item 7, MD&A — Expenses
  20. [20] Item 7, MD&A — Expenses
  21. [21] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  22. [22] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  23. [23] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  24. [24] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  25. [25] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  26. [26] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  27. [27] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  28. [28] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  29. [29] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  30. [30] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  31. [31] Item 7, MD&A — Financial Results and Highlights
  32. [32] Item 7, MD&A — Financial Results and Highlights
  33. [33] Item 7, MD&A — Consolidated Results of Operations, Fee Revenue, Servicing Fee Revenue
  34. [34] Item 7, MD&A — Financial Results and Highlights
  35. [35] Item 7, MD&A — Financial Results and Highlights
  36. [36] Item 7, MD&A — Consolidated Results of Operations, Fee Revenue, Table 9: Activity in Assets Under Management
  37. [37] Item 7, MD&A — Expenses
  38. [38] Item 7, MD&A — Expenses, Repositioning Charges, Table 12
  39. [39] Item 1, Business — Human Capital
  40. [40] Item 1, Business — Overview
  41. [41] Item 1, Business — Human Capital
  42. [42] Item 7, MD&A — Expenses
  43. [43] Item 7, MD&A — Financial Results and Highlights
  44. [44] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  45. [45] Item 7, MD&A — Financial Results and Highlights
  46. [46] Item 7, MD&A — Financial Results and Highlights
  47. [47] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  48. [48] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  49. [49] Item 7, MD&A — Financial Results and Highlights
  50. [50] Item 7, MD&A — Financial Results and Highlights
  51. [51] Item 1A, Risk Factors — Financial Market Risks
  52. [52] Item 1A, Risk Factors — Financial Market Risks
  53. [53] Item 1, Business — Supervision and Regulation, Stress Capital Buffer
  54. [54] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  55. [55] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  56. [56] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  57. [57] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  58. [58] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  59. [59] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  60. [60] Item 7, MD&A — Consolidated Results of Operations, Table 2: Total Revenue
  61. [61] Item 7, MD&A — Consolidated Results of Operations, Table 2: Total Revenue
  62. [62] Item 7, MD&A — Consolidated Results of Operations, Table 2: Total Revenue
  63. [63] Item 7, MD&A — Consolidated Results of Operations, Table 2: Total Revenue
  64. [64] Item 7, MD&A — Expenses, Table 11: Expenses
  65. [65] Item 7, MD&A — Expenses, Table 11: Expenses
  66. [66] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  67. [67] Item 7, MD&A — Financial Results and Highlights, Table 1: Overview of Financial Results
  68. [68] Item 7, MD&A — Consolidated Results of Operations, Provision for Credit Losses
  69. [69] Item 7, MD&A — Consolidated Results of Operations, Provision for Credit Losses
  70. [70] Item 7, MD&A — Financial Results and Highlights
  71. [71] Item 7, MD&A — Financial Results and Highlights
  72. [72] Item 7, MD&A — Financial Results and Highlights
  73. [73] Item 7, MD&A — Financial Results and Highlights
  74. [74] Item 7, MD&A — Financial Results and Highlights
  75. [75] Item 7, MD&A — Financial Results and Highlights
  76. [76] Item 7, MD&A — Financial Results and Highlights
  77. [77] Item 7, MD&A — Financial Results and Highlights
  78. [78] Item 7, MD&A — Financial Results and Highlights
  79. [79] Item 7, MD&A — Financial Results and Highlights
  80. [80] Item 7, MD&A — Financial Results and Highlights
  81. [81] Item 7, MD&A — Line of Business Information, Investment Servicing, Table 13
  82. [82] Item 7, MD&A — Line of Business Information, Investment Servicing, Table 13
  83. [83] Item 7, MD&A — Line of Business Information, Investment Management, Table 14
  84. [84] Item 7, MD&A — Line of Business Information, Investment Management, Table 14

Analysis on 6/10/2026