Morgan Stanley’s inflows of net new assets surged again in the first quarter as revenue for its wealth management business climbed to a record high.
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Morgan Stanley reported Tuesday that its net new assets were up 26% year over year to just over $118 billion in the first three months of 2026. That followed a quarter in which the inflows were up a whopping 116% year over year to reach $122.3 billion.
Net new assets are often seen as a key gauge of success since they measure assets from new or existing clients rather than market gains. Of Morgan Stanley’s new assets in the first quarter, $54 billion went into fee-generating accounts, which are valued for their ability to generate steady streams of income.
“Our client-acquisition funnel remains unrivaled in driving industry-leading growth,” Morgan Stanley CEO Ted Pick said in a call with industry analysts on Wednesday.
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Record revenue, assets in E-Trade and Morgan Stanley at Work
Morgan Stanley’s strong inflows came in a quarter that saw net revenue for the firm’s wealth management business rise by 16% year over year to a record high of $8.52 billion. The wealth division’s client assets were up 22% to nearly $7.35 trillion.
Of that, $5.8 trillion was in accounts managed by financial advisors (up 23% year over year), $1.56 trillion in self-directed accounts in the firm’s E-Trade division (up 21%) and $475 billion in the firm’s Morgan Stanley at Work channel (up 10%).
In previous quarters, Morgan Stanley executives have highlighted how many of the firm’s net new assets have come through Morgan Stanley at Work, which helps companies manage stock-compensation plans and workplace benefits. Chief Financial Officer Sharon Yeshaya told analysts Wednesday that many clients who are coming to the firm through their employers and Morgan Stanley at Work are eventually taking on full-time relationships with financial advisors.
“Since 2020, we have generated over $400 billion in new advisor-led assets from relationships that originated from either workplace or E-Trade,” she said.
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Progress on the $10 trillion goal, holding steady on a 30% profit margin
With its wealth management unit business added to its investment management business, Morgan Stanley’s total for client assets topped $9.7 trillion by the end of the first quarter. Up from $9.3 trillion in the fourth quarter of 2025, that number marked further progress toward the $10 trillion asset goal set under former CEO James Gorman.
The wealth business’s noninterest expenses meanwhile rose by 11% to $5.9 billion. The bulk of that — $4.65 billion — consisted of compensation and benefits.
Profit before taxes for the wealth business was up 33% year over year to nearly $2.6 billion. The division’s pretax margin — or the share of revenue after expenses other than taxes are subtracted — was at 30%, maintaining another goal set under Gorman.
Pick said the firm plans to stay around that pretax margin, but not at the expense of investing in itself. Like many large wealth managers, Morgan Stanley has been plowing money into artificial intelligence and similar technologies in a bid to make its wealth and other businesses operate more efficiently.
“For us, what’s most important is that we’re constantly investing and there are so many places within this best business to invest and it’s paying off,” Pick said. “And over time, we’ll continue to move up the margin on its own organically. The most important thing for us is to continue to put dollars to work to service both our clients and advisors and continue to be a category of one in this business.”
