- REUTERS/Ueslei Marcelino
Citigroup just reported Q1 earnings that beat expectations – despite a major profit drop.
The firm reported adjusted earnings per share of $1.10 on revenues of $17.55 billion.
Analysts were expecting adjusted earnings per share of $1.05 on revenue of $17.53 billion, according to Bloomberg.
Earnings are down 27.6% fromthe same quarter last year, when Citi reported EPS of $1.52 on revenue of $19.80 billion.
“While our market-sensitive products clearly suffered from weak investor sentiment during the quarter, we continued to make progress in several key areas,” CEO Michael Corbat said in a statement.
“We grew loans and deposits in our core businesses, reduced our expenses while absorbing a significant repositioning charge, utilized additional Deferred Tax Assets, and generated capital in excess of what we returned to our shareholders.”
The firm missed expectations on banking revenue but beat on trading. Revenues in both divisions were down significantly from the year-ago quarter:
- Investment-banking revenues came in at $875 million (versus$907 million expected). That’s down27%, “primarily reflecting lower industry-wide activity during the current quarter,” according to the firm.Trading revenue came in at $4.1 billion ($3.7 billion expected), down 15% from the same quarter a year ago.Fixed-income-trading revenues were $3.1 billion ($2.97 billion expected), down 11%.Equity-trading revenues were $706 million ($731 million expected). That’sdown 19% from the year-ago quarter, “reflecting the impact of lower volumes in cash equities as well as weaker performance in derivatives,” the firm said.
Last quarter, Citi beat expectations, reporting adjusted earnings per share of $1.06 ($1.05 expected) on revenue of $18.64 billion ($17.93 billion expected).
The first quarter is typically the strongest for investment banks, but analysts are expecting an unusually weak Q1 earnings season on Wall Street this year.
Morgan Stanley will report Q1 earnings on Monday.