The banking giant posted first-quarter earnings excluding items of 85 per share, up from 68 cents a share in the year-earlier period.
Revenue rose to $9.9 billion from $8.80 billion a year ago.
Wall Street expected Morgan Stanley to deliver quarterly earnings per share of 78 cents on revenue of $9.17 billion, according to a Thomson Reuters consensus estimate.
Morgan Stanley's stock has been underperforming when compared to fellow banking giants Goldman Sachs and JPMorgan Chase .
Last week, both Goldman and JPMorgan reported first-quarter earnings per share that topped analysts' expectations.
Goldman, helped by a burst of trading activity in January when the Swiss central bank removed a cap on the franc, saw profits rise to $5.94 per share, while JPMorgan delivered profits of $1.45 per share.
Last January, Morgan Stanley reported a drop in fourth-quarter adjusted earnings.
-CNBC's Terri Cullen and Reuters contributed to this report.