Earnings Analysis Banco Bilbao Vizcaya Argentaria SA ADR ($BBVA) Q3 2026 Earnings Analysis: Revenue Beat, EPS Miss, Guidance Raised
Earnings Report
Revenue: €10.913 billion (+19.9% YoY, vs. $10.696 billion expected) ✅ Beat
EPS (Earnings Per Share): $0.58 (vs. $0.62 expected, -6.8%) ❌ Miss
Guidance: Upward revision, raising 2026 Return on Tangible Equity (ROTE) outlook from above 20% to above 21%
Stock Reaction: -2.2% (based on BMO closing price for the day)
Highlights
Total Revenue increased 19.9%: €10.913 billion in Q3, with Net Interest Income also rising 21.7%
Net Income increased 19.1%: Net income attributable to owners of the parent was €3.015 billion
Return on Equity 22%: On a 9-month cumulative basis, outperforming the European peer bank average of 15.6%
Loan growth in Mexico and Spain supported the results. Total net profit was €3.203 billion, with the portion attributable to shareholders being the amount excluding the €188 million non-controlling interest. Loan balances increased by 20.4% compared to a year ago, and the cost-to-income ratio stood at 37.9%.
Lowlights
EPS missed expectations: $0.58 fell below the expected $0.62
Operating expense pressure: €4.168 billion in Q3, a 16.6% increase from the same period last year
Loan loss provision targets exceeded: Turkey 2.20 percentage points and South America 2.50 percentage points may exceed guidance
Net income attributable to owners of the parent decreased 1.5% from €3.062 billion in Q2. The 24.2% increase in loan loss provisions due to rising loans remains a burden. The Common Equity Tier 1 (CET1) ratio decreased by 0.20 percentage points to 12.21%.
What the Company Said
CEO Onur Genç raised the group's ROTE outlook to above 21% and stated that shareholder return targets for 2025–2028 will be maintained. At the same time, he mentioned that loan loss provisions in Turkey and South America could slightly exceed annual guidance.
Market Reaction and Future Key Points
With earnings per share falling short of expectations, comments were made that credit loss provisions in Turkey and South America could exceed annual targets.
It is necessary to confirm by how much the fourth-quarter credit loss provision in Turkey exceeds the annual target of 2.20%.
It is necessary to monitor whether delinquency rates in South America, centered around Argentina, stabilize.
The key is whether the annual return on equity (ROE) exceeds 21% to achieve the outlook.
Disclaimer: This content is for informational purposes only and does not constitute investment advice. All investment responsibility lies with the investor.
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