Barclays Posts 12% Profit Growth Amid Global Workforce Cuts
Barclays has reported a 12% rise in Q3 pre-tax profit to £2.3bn (US$3.08bn) and announced a new £500m (US$668m) share buyback as higher income and lower impairment charges supported earnings.
Group income increased 3% to £7.4bn (US$9.9bn), while attributable profit rose 13% to £1.6bn (US$2.1bn) and earnings per share increased 18% to 12.3p (US$0.16).
Return on tangible equity improved to 12% from 11% a year earlier, leaving the bank on track to deliver its target of more than 12% for this year.
Barclays says UK lending has increased 7% year-on-year, which includes a 14% rise at its UK Corporate Bank, while group net interest income excluding the Investment Bank and Head Office increased 7% to £3.5bn (US$4.7bn).
Despite this positive growth, Barclays has also announced plans to cut 5% of its workforce as it attempts to save costs and drive efficiency through investment in AI technologies.
- Barclays reported a 12% rise in Q3 pre-tax profit to £2.3bn (US$3.08bn)
- Equities income jumped 47% to £1bn (US$1.3bn), while fixed income, currencies and commodities revenue fell 19% to £1bn (US$1.3bn)
- Credit impairment charges fell 20% to £503m (US$673m), reducing the quarterly loan loss rate to 43 basis points from 57 basis points a year earlier
- The bank announced plans to cut 5,000 jobs – 5% of its workforce – by the end of the year, having already cut 1,000 roles
- Year-to-date shareholder distributions reached £2.8bn (US$3.7bn), up 46%
Equities surge offsets FICC decline in mixed trading quarter
Barclays delivered mixed trading, with equities income jumping 47% to £1bn (US$1.3bn) but fixed income, currencies and commodities revenue falling 19% to £1bn (US$1.3bn).
Group operating expenses increased 1% to £4.6bn (US$6.2bn), including £201m (US$269m) of restructuring costs, while the cost-to-income ratio improved to 62% from 63%.
Credit impairment charges fell 20% to £503m (US$673m), reducing the quarterly loan loss rate to 43 basis points from 57 basis points a year earlier.
The bank maintained a common equity tier 1 capital ratio of 14%, allowing it to announce another £500m (US$668m) buyback and take year-to-date shareholder distributions to £2.8bn (US$3.7bn), up 46%.
Barclays says it expects 2026 income of around £31.5bn (US$42.1bn) and costs of approximately £18.5bn (US$24.7bn), while retaining its target for return on tangible equity of more than 14% by 2028.
AI has an important role to play and may have a more important role to play in the future."
5,000 jobs to go amid AI-driven restructuring
Alongside its Q3 results, the bank has announced plans to reduce its workforce by 5,000 by the end of the year, having cut 1,000 roles already.
The majority of the job losses are expected in the bank’s home market and will mainly affect operational and functional roles. However, Barclays adds that its global workforce will also be affected.
Discussing the cuts, Barclays CEO CS Venkatakrishnan, also known as Venkat, says the reductions were made following the bank's recent investments in AI technologies.
He adds: “AI has an important role to play and may have a more important role to play in the future.”
A company spokesperson mirrors Venkat’s thoughts, saying the bank is “positioning Barclays for the future, building the workforce and skills needed to deliver our strategy and meet the evolving needs of our customers and clients”.
Despite the reported pre-tax profit of £2.3bn (US$3.08bn), the figure was below analyst expectations as the bank’s fixed income trading business underperformed.
Shares were down more than 2.5%.
Discussing Barclays’s decision to cut jobs, AJ Bell Investment Director Russ Mould says: “The announcement comes as the company failed to match expectations with its third-quarter performance – with the unveiling of a healthy share buyback failing to entirely ease investors' disappointment.”
He adds that despite Barclays’s fixed income trading business performing worse than expected, its equities trading division performed well, describing the bank’s Q3 performance as a “mixed bag”.
Barclays’s key partners:
American Airlines: Barclays partners with American Airlines to issue co-branded AAdvantage credit cards, delivering travel rewards, lounge access, and exclusive customer perks.
CEO: Robert Isom | Headquarters: Fort Worth, Texas, US
General Motors: Barclays collaborates with General Motors as the exclusive issuer for the GM Rewards Mastercard, providing vehicle purchase and service benefits.
CEO: Mary Barra | Headquarters: Detroit, Michigan, US
Gap Inc.: Barclays manages the co-branded credit card portfolio for Gap Inc., offering customer loyalty rewards across brands like Old Navy and Athleta.
CEO: Richard Dickson | Headquarters: San Francisco, California, US
Executives
C.S. Venkatakrishnan
Group CEO
Russ Mould
Analyst