(AP) Morgan Stanley's profit and revenue dipped in the first quarter. Results beat Wall Street's expectations, but the stock still dipped in pre-market trading.
Quarterly revenue from the investment bank slipped, while revenue from wealth management rose.
Earnings totaled $1.2 billion, down about 12 percent from a year earlier. Per share, those earnings amounted to 61 cents, beating the 57 cents expected by analysts polled by FactSet.
Revenue totaled $8.5 billion. That was down 5 percent from a year earlier, but it beat analysts' expectations of $8.3 billion.
The earnings and revenue exclude the effect of an accounting charge related to the value of the bank's debt.
In the investment bank, revenue from trading bonds and commodities for clients fell, a common theme for banks this earnings season. The bank also made less money advising companies on strategies like mergers and acquisitions. But the investment bank did underwrite more stock and bond offerings.
The wealth management unit brought in more fees, and clients shuttled more assets to Morgan Stanley. The number of wealth management representatives fell, down about 440 to 16,300. But the annual revenue that each representative brought in rose, to about $851,000 from $780,000 a year earlier.
In a statement, CEO James Gorman said the first-quarter results represented "solid momentum." He's been steering the bank to depend less on investment banking and more on wealth management, which doesn't usually experience the spectacular gains of investment banking but avoids it big falls.
Last month, Morgan Stanley got the Federal Reserve's approval to finish buying Morgan Stanley Smith Barney, the retail brokerage that it jointly owns with Citigroup. Morgan Stanley already owns 65 percent.
Gorman sounded a cautiously hopeful note about the economy.
The world economy, he said, "continues to have moments of fragility," but, he added, "we believe the broad economic outlook for the next several years is stronger than in the recent past."
Like most of its peers, Morgan Stanley has been trimming expenses, including office space, equipment and marketing costs. The amount the bank spent on salaries and benefits fell 5 percent. Headcount was down 7 percent, with the bank cutting about 3,900 jobs.
The stock dipped in pre-market trading, down 17 cents to $21.30.