Citigroup, Inc. (NYSE:C) shares rose Tuesday after the bank reported stronger-than-expected first-quarter results, driven by broad-based growth across its businesses.

Strong First-Quarter Financial Performance

The bank posted revenue, net of interest expense, of $24.63 billion, up 14% from a year earlier and above analyst estimates of $23.53 billion. Excluding foreign exchange impacts, revenue increased 11%.

Net income climbed 42% to $5.79 billion, while earnings per share of $3.06 topped expectations of $2.63. Net interest income rose 12%, and non-interest revenue increased 17%, reflecting gains across all five core divisions and legacy franchises.

Expenses, Profitability and Capital Position

Operating expenses rose 7% to $14.3 billion, while the efficiency ratio improved by about 410 basis points to 58.1%, down from 62.2% a year earlier. Return on average tangible common equity increased to 13.1%.

The bank's Common Equity Tier 1 capital ratio stood at 12.7%, about 110 basis points above regulatory requirements. Cost of credit rose 3% to $2.81 billion, mainly due to higher net credit losses in U.S. cards.

Segment Performance Highlights

Performance was strong across segments. Services revenue rose 17% to $6.1 billion, while markets revenue increased 19% to $7.2 billion. Banking revenue climbed 15% to $1.8 billion, including a 19% rise in investment banking revenue to $1.3 billion. Wealth revenue grew 11% to $3.1 billion, and U.S. consumer cards revenue rose 4% to $4.8 billion. Revenue in the "all other" category increased 15% to $1.7 billion.

Strategic Progress and Shareholder Returns

CEO Jane Fraser said Citi has entered the final phase of its divestitures, with most transformation programs nearing targets. The bank repurchased $6.3 billion in shares during the quarter and remains on track to meet its 10% to 11% return on tangible common equity goal for the year.

Outlook and Guidance

Citigroup reaffirmed its 2026 outlook, expecting net interest income excluding markets to rise 5% to 6%. It also raised its forecast for branded cards net credit losses to a range of 4.0% to 4.5%.

Earnings Call Highlights

During the earnings call, Citigroup CFO Gonzalo Luchetti struck a broadly confident tone on risk, capital, and business momentum. He said the bank remains comfortable with its exposure to private credit, describing the associated risk as low.

On regulation, Luchetti expects upcoming capital rule changes to be a net positive for Citigroup, with a moderate benefit, though he did not provide a specific estimate of the impact or potential excess capital release.

He also highlighted that Citi's transformation program is about 90% complete, with most of the remaining work tied to internal validation.

On the business front, he pointed to solid momentum in investment banking, noting that M&A pipelines remain strong. While some large deals shifted from the first quarter into the second, overall pipeline activity continues to look healthy.

C Price Action: Citigroup shares were up 2.93% at $129.97 at the time of publication on Tuesday. The stock is trading at a new 52-week high, according to Benzinga Pro data.

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