Updated from 10:35 a.m. EDT

Charles Schwab

( SCH), the discount brokerage with a large presence on the Internet, matched Wall Street analysts' expectations when it announced quarterly earnings Tuesday.

The company said it earned 14 cents a share, exactly the consensus of Wall Street analysts, according to

First Call/Thomson Financial

. Its operating income for the quarter was $199 million on revenue of $1.40 billion. By comparison, in last year's second quarter the company earned $171 million, or 12 cents a share, on revenue of $1.12 billion.

Schwab's mutual fund business grew in the quarter, with total client asset balances up 29% to $312 billion compared to last year's second quarter. In the quarter Schwab added four new funds that target the technology, financial services, health care and communications sectors.

San Francisco-based Schwab's online business grew to 4.1 million accounts with $413.5 billion in assets, up 46% and 65%, respectively, from a year ago. Online trades accounted for 81% of all client trades during the second quarter of 2000, up from 67% during the year-earlier period.

The figures do not reflect costs related to Schwab's

acquisition of

US Trust

, which it announced in January. Including the acquisition-related costs, net income fell to $137 million, or 9 cents a share.

Also Tuesday,

DLJdirect

( DIR), the online brokerage arm of

Donaldson, Lufkin & Jenrette

( DLJ), announced that it came up short of Wall Street estimates in reporting its second-quarter earnings Tuesday.

The Jersey City, N.J.-based company said it lost 6 cents per share in the quarter, or twice as much as the 3-cent loss expected by Wall Street analysts, according to First Call/Thomson Financial. In the same period last year DLJdirect earned 5 cents a share.

The company's net loss for the quarter was $6.6 million on $84 million in revenue. By comparison, in last year's second quarter the company posted a profit of $5.1 million on $60 million in revenue.

"Unprecedented market volatility over the past three months made for a challenging quarter for the online brokerage industry," said Blake Darcy, chief executive officer of DLJdirect, in a statement.

While revenue rose substantially, costs also jumped for the quarter. Costs totaled $91.9 million, compared to just $48.8 million last year, as the company invested heavily in marketing, technology and personnel.

"We are continuing to build our franchise both domestically and internationally," said Glenn Tongue, DLJdirect's president. "The online brokerage industry is still in its early stages in terms of worldwide customer penetration. We are making significant investments to ensure that DLJdirect remains the highest-quality, lowest-cost provider of electronic brokerage services worldwide."

Schwab finished Tuesday regular trading up 15/16, or 2.5%, at 38 3/16, and DLJDirect closed down 13/16, or 9.6%, at 7 5/8.

Also Tuesday,

Merrill Lynch

( MER), the nation's largest securities firm,

released better-than-expected earnings. Donaldson, Lufkin & Jenrette, DLJdirect's parent, is scheduled to release earnings Wednesday.