Barclays Q3 profit misses expectations amid weakness in fixed income

22nd Oct 2026 07:51

(Sharecast News) - Barclays reported a slightly lower-than-expected third-quarter profit on Thursday following a strong performance in equities but weakness in fixed income, as it announced a £500m share buyback and confirmed plans to cut around 5,000 jobs this year in an AI push.

In the three months to the end of September, pre-tax profit grew 12% to £2.3bn, missing expectations of £2.4bn, while earnings per share were 18% higher year-on-year at 12.3p.

The return on tangible equity rose to 11.7% in Q3 from 10.6% in the same period a year earlier, and Barclays said it was on track to deliver a RoTE greater than 12% in 2026.

Barclays hailed a strong performance in the equities segment, where total income surged 47% to £1bn, reflecting prior investment in prime financing and equity derivatives.

This helped to offset a 19% drop in income to £1bn in FICC (Fixed Income, Currencies, and Commodities), which reflected lower client activity in rates and credit into the second half of the quarter, and "further adversity" in September due to the macroeconomic environment.

Investment banking saw a 3% dip in income to £1.1bn in the third quarter.

Chief executive C. S. Venkatakrishnan said he was "pleased with the ongoing momentum of Barclays' operational and financial performance".

"With one quarter to go before the end of our original three-year plan, we have either achieved or are on track to achieve all of our 2026 group targets," he said. "We are confident in and committed to the 2028 targets that we laid out earlier in the year."

Also on Thursday, Barclays confirmed it is planning to cut around 5,000 jobs this year, as it looks to drive efficiencies through the use of AI.

At 0955 BST, the shares were up 0.5% at 421.45p.

Russ Mould, investment director at AJ Bell, said: "Barclays is reaching for the AI lever, expecting to cut a decent chunk of its workforce as it expands the use of artificial intelligence across its operations.

"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.

"Barclays is an outlier compared with UK counterparts Lloyds and NatWest thanks to its meaningful investment banking presence.

"The performance here was a real mixed bag as its equities trading division performed robustly but it suffered on the fixed income side.

"Across the wider group costs went up and Barclays shareholders are also having to contend with two major clouds over the business. The first being a widely expected increase in tax on the sector in next week's Autumn Budget and the other being a reported probe into possible misrepresentation of risks in its private credit portfolio.

"The former will at least be resolved in the near term, but the latter looks set to weigh on the shares for longer as the Bank of England's Prudential Regulation Authority pursues its investigation."

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