Tariffs schmariffs. They’re laughing all the way to the bank. Bank of America and Citigroup joined other Wall Street lenders Tuesday in reporting much better-than-expected earnings in the first three months of the year.

Like Goldman Sachs and JPMorgan before them, they can thank a boom in stock-trading: Revenue from that business rose 17% to a record $2.2 billion at BofA and 23% to $1.5 billion at Citi. That’s great news for the street, but the banks also offered good news for the broader economy.

Worried Consumers Flex Their Wallets

Banks pocketed huge sums in the first quarter from equities because the “increased market volatility” — as Citi rather politely described the market turmoil caused by tariffs — prompted clients to readjust their portfolios.

Swelling bank revenue likely won’t ease the uncertainty and anxiety gripping Americans and businesses alike. The most recent reading of the University of Michigan’s closely watched consumer sentiment index this past week showed a freefall this month, down 11% from March to a 50.8 reading, one of the worst in the past decade. Consumer inflation expectations jumped from 5% in March to 6.7%, the highest reading in over 40 years.

On the upside, data from the banks showed those fears may not have had a significant behavioral impact, as consumer spending — which accounted for 68% of US GDP in Q4 2024 — was surprisingly buoyant in the first three months of the year:

• BofA said combined debit and credit card spending climbed 4% year-over-year in the first quarter to $228 billion, while early- and late-stage credit card delinquencies went down compared with the fourth quarter of 2024. Spending on Citi’s branded credit cards rose 3% and delinquencies of 90 days or more remained flat, according to the group’s presentation. JPMorgan Chase, meanwhile, reported Friday that credit- and debit-card spending rose 7% YoY.
• BofA’s provision for credit losses — aka the pile of cash it keeps on hand to protect against a decline in consumer credit — remained flat at $1.5 billion, suggesting the lender doesn’t foresee an immediate concern. “The signals at this point from the consumer are that the U.S. economy still remains in good shape,” CFO Alastair Borthwick said on a media conference call.

Citi CEO Jane Fraser had an even more optimistic message for markets: “When all is said and done, and longstanding trade imbalances and other structural shifts are behind us, the U.S. will still be the world’s leading economy, and the dollar will remain the reserve currency.”

Reversing the Dip? BofA shares rose 3.6% Tuesday and Citi climbed 1.7%, producing gains on a day when the S&P 500 fell, albeit by less than 0.2%. The KBW Nasdaq Bank Index, which tracks the leading US lenders, added 1.2% — a reprieve that pared its decline during a tumultuous start to the year to about 13%.

Winning the streaming wars is not enough. Now, Netflix wants to be in the big leagues with names like Apple, Amazon, and Nvidia.

With Hollywood conquered, Netflix has a new goal: reaching a $1 trillion market cap by 2030, according to a Wall Street Journal report. In other words: It wants to leave its streaming war co-combatants in the dust.

Swimming Upstream

Joining the trillion-dollar club by the turn of the decade is a lofty goal — it’d require more than doubling a current market cap of about $417 billion — but, according to a source who spoke with the WSJ, the company sees something of a road map based around two hand-in-hand goals: Growing to about 410 million subscribers, up from about 300 million at the end of last year, and doubling annual revenue from last year’s $39 billion mark.

Growing the subscriber base means continuing an aggressive push into international markets, where the company already has a head start over its competitors. Last year, 51% of the company’s content budget went to non-US productions, according to Ampere Analysis data, and sources told the WSJ that Netflix is aggressively pushing into markets with high broadband penetration, such as Brazil and India. Growing the subscriber base, of course, means growing its revenue, too — and the company says it should achieve critical scale in its ad-supported subscriber base this year. According to industry analysts at MoffetNathanson, doing so “should unlock a new runway of growth in the business for years to come.” The company is aiming for $9 billion in annual ad revenue by 2030, sources told the WSJ.

In the process, Netflix could balloon its already sizeable streaming lead:

• Netflix remains the leader by far in streaming profitability, with net income last year of $8.7 billion. Disney and Warner Bros. Discovery both finally made money in streaming in 2024, and both hope to reach $1 billion in streaming profits this year; Paramount and Comcast, meanwhile, continued to lose money in streaming last year.
• In the first quarter of 2025, Netflix and Amazon were neck-and-neck in streaming market share, both holding about 20%, according to industry analysis firm JustWatch, while no other service held more than 13% market share. Still, Netflix says it captures only around 10% of total television screen time in all of its markets, meaning it sees room to grow.

Recession and Chill: Netflix has also proven resilient amid this year’s market meltdown, with its share price up around 10% year-to-date, defying the S&P 500’s 8% stumble. Executives see the company as somewhat recession-proof since cash-strapped consumers will be more likely to stay at home and watch TV. A word to the wise: Don’t expect to find some fun escapism in Netflix’s recent (harrowing) releases like Adolescence and Zero Day.

Elliott Management has infiltrated the shareholder ranks of Hewlett Packard Enterprise, reportedly snatching up $1.5 billion worth of HPE’s stock with the goal of turning around a company that has lost more than a fourth of its market value this year.

The server provider — which split off from the consumer-facing printer and PC company HP a decade ago — disappointed investors last month when it predicted its second-quarter and full-year earnings would come in below analysts’ expectations. The company pointed to deep discounting in the industry as it struggled to sell both AI and traditional servers.

To offset its losses, HPE has a plan to slash overhead with layoffs affecting about 5% of its workforce. Elliott is said to have other ideas about how HPE can boost its bottom line — though it hasn’t yet shared the deets.

Change Starts From Within

Activist investors are like the business world’s “Property Brothers,” flipping struggling companies instead of derelict houses. Often specialty hedge funds, the investors buy a stake in a company to try to force change from within, usually to boost the company’s shares (though sometimes they have other aims).

Elliott is one of the best-known activist investors because it has a history of going after industry titans and managed nearly $70 billion worth of assets as of last summer. That includes stakes at Southwest and Starbucks, where the firm pushed for strategy shifts resulting in changes that haven’t always been popular with customers:

• Several big changes at Southwest Airlines, including scrapping its famous two-bags-fly-free policy, came as a result of Elliott flexing its 11% stake in the company.
• The recent shakeup at Starbucks that saw the coffee giant swap its CEO and pour its olive-oil lattes down the drain was also sparked by Elliott’s investment.

Upping the Ante: Buying a stake isn’t always enough leverage for activist investors like Elliott to incite change. If a minority stake fails to bend execs’ ears, activist investors can wage a proxy fight where they rally shareholders to elect new board members and force change from the top. Elliott is currently in a proxy fight with oil refiner Phillips 66, whose execs have defended the company’s results and refused to overhaul the board. It currently has 14 members serving staggered three-year terms, 10 of whom are scheduled to keep their seats through 2026 or 2027. Next month, shareholders will choose between seven Elliott-selected board candidates and four picked by Phillips 66.