Why did UBS's Q2 earnings exceed forecasts significantly?

UBS's Q2 earnings exceeded forecasts significantly due to several key factors:

1. **Revenue Growth**: UBS reported a 24.8% year-over-year increase in total revenues, reaching $11.9 billion. This growth was primarily driven by the acquisition of Credit Suisse, which acted as a tailwind for the company's revenue stream.
2. **Cost Management**: Despite the increase in revenues, UBS also reported a 21.8% year-over-year rise in operating expenses, totaling $10.3 billion. The company's ability to manage costs effectively, coupled with the revenue growth, contributed to the positive earnings surprise.
3. **Credit Loss Expenses**: UBS reported a decrease of 84.8% in credit loss expenses, amounting to $95 million. This reduction in credit losses, compared to the prior year, provided an additional boost to the company's earnings.
4. **Business Division Performance**: The Asset Management division saw a significant surge in operating profit before tax, with a 64.6% year-over-year increase, reaching $130 million. The Global Wealth Management division also performed well, with a reported operating profit before tax of $871 million, despite a 15.3% decline year-over-year.

In summary, UBS's Q2 earnings exceeded forecasts due to strong revenue growth, effective cost management, lower credit loss expenses, and solid performances across its business divisions.