It has been about a month since the last earnings report for The Bank of New York Mellon Corporation (BK Quick QuoteBK - Free Report) . Shares have added about 6.7% in that time frame, outperforming the S&P 500.

But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is The Bank of New York Mellon due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.

BNY Mellon Q2 Earnings Beat on Higher Fee Income, Expenses Rise Y/Y

BNY Mellon's second-quarter 2025 adjusted earnings of $1.94 per share surpassed the Zacks Consensus Estimate of $1.74. Also, the bottom line reflected a jump of 28% from the prior-year quarter.

Results were primarily aided by a rise in fee revenues and NII. Also, the company recorded a provision benefit in the quarter, which was a tailwind. Growth in the AUC/A and AUM balances further supported results. However, higher expenses were an undermining factor.

The results excluded certain non-recurring items. Considering those, net income applicable to common shareholders (GAAP basis) was $1.39 billion, up 22% from the year-ago quarter. We had projected a net income applicable to common shareholders of $1.15 billion.

Revenues Improve, Expenses Rise

Total revenues increased 9% year over year to $5.03 billion. This is the first time the company’s quarterly revenues exceeded $5 billion. The top line surpassed the Zacks Consensus Estimate of $4.86 billion.

NII was $1.20 billion, up 17% year over year. The rise reflected the continued reinvestment of maturing investment securities at higher yields and balance sheet growth, partially offset by changes in deposit mix. Our estimate for the metric was $1.10 billion.

NIM expanded 12 basis points (bps) year over year to 1.27%. Our estimate for NIM was 1.28%.

Total fees and other revenues increased 7% year over year to $3.83 billion. The rise was driven by an increase in investment services fees and foreign exchange revenues. Our estimate for the same was $3.69 billion.

Total non-interest expenses (GAAP basis) were $3.21 billion, up 4% from the prior-year quarter. The rise was driven by an increase in almost all the cost components except for net occupancy costs, distribution and servicing costs, and costs related to the amortization of intangible assets. We had projected non-interest expenses of $3.23 billion.

Asset Balances Increase

As of June 30, 2025, AUM was $2.11 trillion, up 3% year over year. The rise reflected higher market values and the favorable impact of the weaker U.S. dollar, partially offset by cumulative net outflows. Our estimate for AUM was $2.08 trillion.

AUC/A of $55.8 trillion increased 13% year over year, primarily reflecting client inflows, higher market values and the favorable impact of a weaker U.S. dollar.

Credit Quality Improves

The allowance for loan losses, as a percentage of total loans, was 0.38%, down 2 bps from the prior-year quarter. As of June 30, 2025, non-performing assets were $161 million, down from $227 million in the year-ago quarter.

In the reported quarter, the company recorded a provision benefit of $17 million, primarily driven by property-specific reserve releases related to its commercial real estate exposure. In the prior-year quarter, provisions were nil. We had expected provisions to be $14.9 million.

Capital Position Improves

As of June 30, 2025, the common equity Tier 1 ratio was 11.5%, up from 11.4% as of June 30, 2024. The Tier 1 leverage ratio was 6.1%, up from 5.8% as of June 30, 2024.

Share Repurchase Update

In the reported quarter, BNY Mellon repurchased shares worth $895 million.

2025 Outlook

Management expects NII to be up in the high single-digit range from $4.3 billion in 2024. This is higher than the previous guidance of a mid-single-digit increase. 

Fee income is expected to improve from $13.6 billion in 2024. This is likely to be driven by higher organic growth and the unfavorable impact of a stronger U.S. dollar.

Excluding notable items, expenses are expected to rise roughly 3% from $12.5 billion in 2024, up from the prior outlook of increasing 1-2%. This is likely to be due to higher revenue-related expenses and continued investments, partly offset by the effects of efficiency savings.

The effective tax rate is estimated to be in the 22-23% range.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a upward trend in estimates revision.

VGM Scores

At this time, The Bank of New York Mellon has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise The Bank of New York Mellon has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.