Citigroup Q3 Earnings Beat Estimates on Y/Y NII Growth, Stock Up

Citigroup Inc. C reported third-quarter 2025 adjusted net income per share of $2.24, up 48.3% from the year-ago period. The metric also surpassed the Zacks Consensus Estimate by 17.3%.

C shares gained roughly 1% in the pre-market trading session on better-than-expected results.

The company's results benefited from an increase in net interest income (NII) and non-interest revenues alongside lower provisions. Citigroup also registered a year-over-year increase of 17% in investment banking (IB) revenues, reflecting growth in Advisory and Equity Capital Markets. However, increases in expenses and a weak capital position were undermining factors.

Net income (GAAP basis) in the quarter was $3.8 billion, up 15.9% from the prior-year quarter.

C’s Revenues & Expenses Increase

Revenues, net of interest expenses, moved up 9.3% year over year to $22.1 billion in the third quarter of 2025. The top line surpassed the Zacks Consensus Estimate by 4.5%.

NII rose 11.8% year over year to $14.9 billion, whereas non-interest revenues rose 4.4% to $7.2 billion.

Citigroup’s operating expenses rose 8.7% year over year to $14.3 billion. This increase in expenses was primarily due to a rise in almost all components except advertising and marketing costs and restructuring expenses.

Citigroup’s Segmental Performance

In the Services segment, total revenues, net of interest expenses, were $5.4 billion in the reported quarter, up 6.9% year over year. The increase primarily reflects growth in Treasury and Trade Solutions, which continued to gain market share, and Securities Services.

The Markets segment’s revenues increased 15.5% year over year to $5.6 billion, driven by growth in Fixed Income and Equity markets revenues.

Banking revenues of $2.1 billion moved up 33.5% year over year, primarily driven by growth in IB and Corporate Lending.

U.S. Personal Banking’s revenues were $5.3 billion, up 7.4% from the prior-year quarter, driven by growth in Branded Cards and Retail Banking, largely offset by a decline in Retail Services.

In the Wealth segment, revenues were $2.2 billion in the reported quarter, rising 8.5% year over year. The increase was driven by growth in Citigold and the Private Bank businesses, partially offset by the Wealth at Work business.

Revenues in the All Other segment declined 15.7% year over year to $1.5 billion.

C’s Balance Sheet Position Solid

At the end of the third quarter of 2025, the company’s deposits rose 1.9% from the prior quarter to $1.38 trillion. Its loans also increased 1.2% on a sequential basis to $733.9 billion.

Citigroup's Credit Quality: Mixed Bag

Total non-accrual loans jumped 69.8% year over year to $3.7 billion. C’s allowance for credit losses on loans was $19.2 billion, up 4.6% from the prior-year quarter.

C’s provisions for credit losses and benefits, and claims for the third quarter were $2.5 billion, down 8.4% from the year-earlier quarter.

C's Capital Position Weak

At the end of the third quarter of 2025, the bank’s Common Equity Tier 1 capital ratio was 13.2%, down from 13.71% in the third quarter of 2024. The company’s supplementary leverage ratio in the reported quarter was 5.5%, down from the prior-year quarter’s 5.85%.

Citigroup's Capital Deployment

In the reported quarter, C returned $5 billion to shareholders through common share dividends and share repurchases.

Our Viewpoint on Citigroup

The company’s third-quarter 2025 results continued to showcase momentum, positive operating leverage and improved returns in each of the five businesses. Increased NII and lower provisions look encouraging. However, rising expenses and a weak capital position were concerning.

The business transformation initiatives, including its consumer business exits and organizational simplification efforts, will help it in the long run. Focus on growth in the profitable business while eliminating non-viable segments will likely aid results in the long run.

Citigroup Inc. Price, Consensus and EPS Surprise

Citigroup Inc. price-consensus-eps-surprise-chart | Citigroup Inc. Quote

Currently, Citigroup carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Earnings Dates & Expectations of Other Banks

Citizens Financial Group, Inc. CFG is slated to report third-quarter 2025 results on Oct. 15. Over the past seven days, the Zacks Consensus Estimate for CFG’s quarterly earnings per share has been unchanged at $1.02.

Fifth Third Bancorp FITB is scheduled to release third-quarter 2025 earnings on Oct. 17. The consensus estimate for FITB’s quarterly earnings has been revised 1.1% lower to 87 cents per share over the past seven days.

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This article originally published on Zacks Investment Research (zacks.com).

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