Charles Schwab plans job cuts and office downsizing amid efforts to reduce operating costs

FILE - This July 14, 2010, file photo, shows a Charles Schwab office in Oakland, Calif. Charles Schwab plans to cut jobs and close or downsize some corporate offices as part of company efforts to reduce operating costs, the financial services firm said in a Monday, Aug. 21, 2023 regulatory filing. (AP Photo/Paul Sakuma, File)
FILE - This July 14, 2010, file photo, shows a Charles Schwab office in Oakland, Calif. Charles Schwab plans to cut jobs and close or downsize some corporate offices as part of company efforts to reduce operating costs, the financial services firm said in a Monday, Aug. 21, 2023 regulatory filing. (AP Photo/Paul Sakuma, File)

NEW YORK (AP) — Charles Schwab plans to cut jobs and close or downsize some corporate offices as part of company efforts to reduce operating costs, the financial services firm said in a Monday regulatory filing.

With these cuts, Charles Schwab expects to achieve at least $500 million of incremental annual run-rate cost savings — but also incur about $400 million to $500 million from expenses like employee compensation, benefits and facility exit costs.

The Westlake, Texas-based company did not specify how many positions would be eliminated — but suggested that the layoffs will take place in the coming months, noting that it anticipated most costs related to these job cuts for the second half of 2023.

Office locations set to be impacted by closures or downsizing were also not specified, but Charles Schwab said it expected to incur those real estate-related costs in 2023 and 2024.

In Monday's filing, the company pointed to previously-announced “incremental actions to streamline its operations to prepare for post-integration” — in addition to cost synergies related to the integration of stockbroker TD Ameritrade, which Charles Schwab acquired for $22 billion in 2020. The job cuts and office reductions arrive as the company assesses its real estate footprint and works to lower its operating costs.

“We have said, we intend to take a series of actions this year and into 2024 aimed at removing cost and complexity from the firm, including reducing our expense base and streamlining our operating model,” a Charles Schwab spokesperson said in a statement sent to The Associated Press. “This will result in eliminating some positions in the coming months, mostly in non-client facing areas.”

In July, Charles Schwab reported net income of $1.3 billion, down from $1.8 billion for the same period in 2022. At the time, the company said it was closing offices in five cities — Atlanta, San Antonio, San Diego, St. Louis and Tampa — by Oct. 1 and downsizing its real estate footprint in six other markets, Charles Schwab confirmed to Think Advisor and other news outlets last month.

Charles Schwab shares were down about 3% in Tuesday morning trading.


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