Morgan Stanley Cuts 2,500 Jobs Despite Record $70.6 Bn Revenue in 2025

Investment banking giant Morgan Stanley has laid off around 2,500 employees, or 3% of its total workforce, The Wall Street Journal reported. The cuts span the firm's three major divisions, Institutional Securities, Wealth Management and Investment Management, and affect staff across the United States and other countries.

Many employees received their notifications as early as this week, though the restructuring had been in the works before Wednesday, when a bulk of the layoffs took place, according to the WSJ.

In the wealth management division specifically, the axe fell on private bankers and back-office staff. The broader round of cuts was driven by a combination of factors, including, shifting business and location priorities, as well as individual job performance, the report added.

The timing of this move may seem puzzling at first glance. Morgan Stanley is not a company in financial distress. In fact, its most recent earnings report showed record full-year revenues of $70.6 billion for 2025, with investment banking revenues surging 47% in the final quarter alone, beating Wall Street expectations for fourth-quarter profits and signalling a strong rebound in dealmaking after a quiet few years.

Yet the layoffs are happening anyway, a sign that strong revenues and a large headcount are no longer seen as going hand in hand.

Notably, this is not the first time Morgan Stanley has done this. The bank has carried out several rounds of job cuts over recent years as market conditions have evolved.

Around the same time last year, it reportedly trimmed approximately 2,000 roles, making this latest round slightly larger in scale.

The investment banking giant's move is part of a broader wave of workforce restructuring sweeping across finance and technology. Last month, Citigroup was reported to be cutting around 1,000 jobs as part of a longer plan to reduce its global headcount by 20,000 by the end of 2026, a plan announced two years ago.

Most recently, Block, the tech and financial services company founded by Twitter Co-founder Jack Dorsey, announced it would cut 4,000 of its 10,000 employees, citing the growing capabilities of AI as a key reason for the reduction.