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Citigroup's second-quarter performance eclipsed expectations, due largely to revenue wins in each of its five businesses, including big gains in investment banking, markets and wealth.
Revenues for each rose by double digits year over year. Wealth topped the list, with revenues up 20% compared with the same quarter last year, furthering the momentum that's been building in that segment in recent quarters. Investment banking revenue rose 18% year over year while markets revenue rose 16%, driven by growth in fixed-income and equities markets revenues.
Combined, Citi's second-quarter revenue came in at $21.7 billion, up 8% from the same quarter last year. Net income for the period that ended June 30 was $4 billion, up 25% year over year.
Earnings per share totaled $1.96, easily topping the average $1.61 per share that analysts polled by S&P Capital IQ had predicted.
In a press release Tuesday announcing Citi's results, CEO Jane Fraser said: "We … continue to demonstrate that our strong results are sustainable through different environments."
"We're improving the performance of each of our businesses to take share and drive higher returns," she added.
The company has been focused on achieving a key profitability metric — return on tangible common equity — as part of a business turnaround that Fraser has been leading since 2021.
Read more about Citigroup here: https://www.americanbanker.com/organization/citigroup
At the company's 2022 investor day, it said it was shooting for an ROTCE of 11-12% within three to five years. But in January, it revised that goal downward to 10-11% by 2026, citing higher expenses, including no more than $53 billion in total costs for all of 2025.
For the second quarter, Citi's ROTCE was 8.7%, compared with 9.1% in the first quarter.
On Tuesday, the bank tweaked some of the 2026 profitability targets it laid out in January, pushing its full-year revenues expectations to $84 billion, which reflects a slight revision to the $83.1 billion-$84.1 billion range that it initially shared at the beginning of the year.
It revised its forecast for net interest income, now predicting that NII excluding markets will grow about 4% for the whole year, up from the earlier 2%-3% growth it had predicted. Expenses, which had been forecast to total slightly below $53.4 billion, are now in line to be at that number.
Read more about bank earnings: https://www.americanbanker.com/earnings
Expenses during the second quarter were $13.6 billion, up 2% year over year, the bank said.
In April, Fraser said the bank doesn't plan to compromise on investing in its transformation, the CEO's signature, years-long initiative to modernize its infrastructure and improve its data and regulatory reporting.
In Tuesday's press release, Fraser said she's "particularly pleased that the momentum across our franchise" includes the transformation initiative, "as we streamline processes, drive automation and deploy [artificial intelligence]. On Monday, Citi said it has begun rolling out agentic artificial intelligence to its developers to automate simple tasks like software patches and upgrades.
During Fraser's five-year reign as CEO, Citi has been trying to simplify itself. The bank has exited underperforming markets, reduced layers of management and realigned its businesses into the five core segments, which also includes services and U.S. personal banking.
During the second quarter, Citi announced that its Polish subsidiary, Citi Handlowy, agreed to sell its consumer banking business to Velobank. The deal is expected to close by mid-2026.
Citi has largely completed retail-related exits and wind-downs in overseas markets, leaving just one overseas market departure to finish. Last year, the bank separated its Mexico retail franchise, Banamex, from its corporate and investment banking business and it plans to take Banamex public with an initial public offering. The timing of the IPO depends on regulator approvals and market conditions to maximize shareholder value, Citi has said.
