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Nomura Holdings reports a 25.7% drop in Q3 (ended Dec. 31) net income to ¥79.1 billion ($651m), but still beat analysts' consensus estimate of ¥60.48b ($498m) based on a poll by Reuters. Revenue increased 6.4% to ¥589.5b ($4.85b). It was another quarter of tough comparison and declining brokerage commissions. In a positive light, net income grew 81.7% q-o-q on revenue growth of 25.6%. Nomura-NMR-1yr-chart-01-26-07 Rival Daiwa Securities also saw its profit fall, by 31% to ¥26.75b ($220m), but it was a 57% q-o-q increase, also beating analysts' consensus forecast (¥23.56b). As competition in the brokerage industry continues to intensify with banks entering the market, both Nomura and Daiwa are looking overseas for growth. During the quarter, Nomura agreed to purchase electronic brokerage Instinet -- the deal reportedly valued at around $1b -- and made an $888m equity investment (15% stake) in Fortress Investment Group.

• Sources: Earnings release and presentation [pdf], Bloomberg, Reuters
• Related commentary: Goldman Raises Nomura's Target Share Price, Maintains "Buy" Rating, Japan: A lot of Idle Cash 'Gradually' Flowing into Stocks, Goldman Top M&A Adviser in Japan, Nomura Falls to Sixth
• Potentially impacted stocks and ETFs: Nomura Holdings (NYSE:NMR). Competitors: Daiwa Securities (OTC:DSECY), Nikko Cordial (OTC:NIKOY), Goldman Sachs (NYSE:GS), Merrill Lynch (MER), Morgan Stanley (NYSE:MS), UBS AG (NYSE:UBS)

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Source: Nomura's Q3 Earnings Fall 26%, But Beat Estimates