Financial services giant Morgan Stanley has slashed almost 3% of its workforce, which translates to 2,500 employees across its major divisions. A source familiar with the matter told Reuters that the reduction spans across investment banking and trading, wealth management, and investment management. Financial advisors, however, remain unaffected according to the source.
The bank comes off a record-breaking 2025, with annual revenue hitting historic highs. Fourth-quarter profits also exceeded Wall Street expectations, fuelled by a 47% rise in investment banking revenue as dealmaking surged and debt underwriting fees nearly doubled.
The entity had entered 2026 with optimism, citing strong pipelines for mergers and acquisitions as well as initial public offerings.
At the same time, trading desks remain busy, as clients navigate volatile markets caused by AI disruption to traditional technology firms and ongoing geopolitical uncertainty.
The source said the job cuts were guided by strategy and individual performance, while the bank plans to hire in other areas. Morgan Stanley’s global workforce stood at 82,992 at the end of December.
The layoffs follow a broader trend in the US, where companies have streamlined operations amid increased adoption of AI tools. Last month, payments company Block, led by Jack Dorsey, announced it had cut over 4,000 roles, nearly half its staff, to embed AI across its operations
