Financial services giant State Street (NYSE: STT) missed Wall Street’s revenue expectations in Q3 2026, but sales rose 12.9% year on year to $4.00 billion. Its non-GAAP profit of $3.69 per share was in line with analysts’ consensus estimates.

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Company Overview

Dating back to 1792 when Boston's Long Wharf was the center of global shipping and trade, State Street (NYSE: STT) provides custody, investment management, and other financial services to institutional investors like pension funds, asset managers, and central banks worldwide.

Revenue Growth

Examining a company’s long-term performance can provide clues about its quality. Any business can have short-term success, but a top-tier one grows for years. Regrettably, State Street’s revenue grew at a tepid 5.6% compounded annual growth rate over the last five years. This wasn’t a great result compared to the rest of the financials sector, but there are still things to like about State Street.

Long-term growth is the most important, but within financials, a half-decade historical view may miss recent interest rate changes and market returns. State Street’s annualized revenue growth of 10.8% over the last two years is above its five-year trend, suggesting some bright spots. Note: Quarters not shown were determined to be outliers because they were impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.

This quarter, State Street’s revenue grew by 12.9% year on year to $4.00 billion but fell short of Wall Street’s estimates.

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Assets Under Management (AUM)

Assets Under Management (AUM) is the total capital a firm oversees or manages on behalf of clients. Fees on this AUM, typically a small percentage, are contractually recurring and provide a high level of stability to revenue even if investment performance lags (although too much poor investment performance eventually hurts fundraising ability).

State Street’s AUM has grown at an annual rate of 10% over the last five years, slightly better than the broader financials industry and faster than its total revenue. When analyzing State Street’s AUM over the last two years, we can see that growth accelerated to 16.8% annually. Fundraising or short-term investment performance was a net contributor for the company over this shorter period since assets grew faster than total revenue. That said, assets aren’t the be-all and end-all due to their unpredictable and cyclical nature.

In Q3, State Street’s AUM was $6.31 trillion, beating analysts’ expectations by 0.9%. This print was 15.8% higher than the same quarter last year.

Key Takeaways from State Street’s Q3 Results

It was good to see State Street narrowly top analysts’ AUM expectations this quarter. On the other hand, its revenue slightly missed. Overall, this was a weaker quarter. The stock traded down 6.9% to $162.04 immediately after reporting.

Is State Street an attractive investment opportunity right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).