East West Bank’s (NASDAQ:EWBC) Q4 CY2025 Sales Beat Estimates

Cross-border banking company East West Bancorp (NASDAQ:EWBC) reported Q4 CY2025 results beating Wall Street’s revenue expectations, with sales up 12.2% year on year to $758.3 million. Its non-GAAP profit of $2.52 per share was 0.8% above analysts’ consensus estimates.

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Company Overview

As the largest independent bank in the U.S. focused on bridging financial services between America and Asia, East West Bancorp (NASDAQ:EWBC) operates a commercial bank that provides personal and business banking services with a unique focus on facilitating U.S.-Asia cross-border transactions.

Sales Growth

Two primary revenue streams drive bank earnings. While net interest income, which is earned by charging higher rates on loans than paid on deposits, forms the foundation, fee-based services across banking, credit, wealth management, and trading operations provide additional income. Thankfully, East West Bank’s 12.4% annualized revenue growth over the last five years was solid. Its growth beat the average banking company and shows its offerings resonate with customers.

Long-term growth is the most important, but within financials, a half-decade historical view may miss recent interest rate changes and market returns. East West Bank’s recent performance shows its demand has slowed as its annualized revenue growth of 5.5% over the last two years was below its five-year trend. Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.

This quarter, East West Bank reported year-on-year revenue growth of 12.2%, and its $758.3 million of revenue exceeded Wall Street’s estimates by 1.6%.

Net interest income made up 86.6% of the company’s total revenue during the last five years, meaning East West Bank barely relies on non-interest income to drive its overall growth.

While banks generate revenue from multiple sources, investors view net interest income as the cornerstone - its predictable, recurring characteristics stand in sharp contrast to the volatility of non-interest income.

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Tangible Book Value Per Share (TBVPS)

Banks operate as balance sheet businesses, with profits generated through borrowing and lending activities. Valuations reflect this reality, emphasizing balance sheet strength and long-term book value compounding ability.

When analyzing banks, tangible book value per share (TBVPS) takes precedence over many other metrics. This measure isolates genuine per-share value by removing intangible assets of debatable liquidation worth. Traditional metrics like EPS are helpful but face distortion from M&A activity and loan loss accounting rules.

East West Bank’s TBVPS grew at an incredible 12.6% annual clip over the last five years. TBVPS growth has also accelerated recently, growing by 15% annually over the last two years from $46.31 to $61.27 per share.

Over the next 12 months, Consensus estimates call for East West Bank’s TBVPS to grow by 12% to $68.65, mediocre growth rate.

Key Takeaways from East West Bank’s Q4 Results

It was encouraging to see East West Bank beat analysts’ revenue expectations this quarter. We were also happy its net interest income narrowly outperformed Wall Street’s estimates. On the other hand, its EPS slightly beat. Zooming out, we think this was a mixed quarter. The stock remained flat at $115.88 immediately following the results.

So should you invest in East West Bank right now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).