Capital One Profit Falls -- Update
27 January 2016 - 10:23AM
Dow Jones News
By Josh Beckerman
Capital One Financial Corp. said its profit fell 7.9% in the
fourth quarter, hurt by higher marketing and operating expenses,
while revenue climbed.
As one of the country's largest credit-card lenders, Capital
One's results are often considered a gauge of consumer sentiment.
The company also offers traditional bank accounts, mortgages, auto
loans and commercial loans.
Capital One reported a profit of $920 million, or $1.58 a share
in the fourth quarter, compared with $999 million, or $1.73 a
share, in the same period a year earlier. Excluding one-time items,
earnings were $1.67 a share.
Revenue improved to $6.19 billion from $5.81 billion.
Analysts polled by Thomson Reuters expected a per-share profit
of $1.61 on revenue of $6.11 billion.
Non-interest expenses increased 6% to $3.5 billion, while
marketing costs rose 11% and operating expenses climbed 6.1%.
Earnings from continuing operations fell to $1.56 a share from
$1.68 a year earlier.
Provision for credit losses rose to $1.38 billion from $1.11
billion.
In late 2015, Capital One bought a health-care financing
business from General Electric Co. for about $9 billion.
Last week, American Express Co. said fourth-quarter earnings
were hurt by a strengthening U.S. dollar, pressure on merchant fees
and competition. The company also issued a bleak outlook for
2017.
Visa Inc., MasterCard Inc. and Discover Financial Services Inc.
are scheduled to report results this week.
Write to Josh Beckerman at josh.beckerman@wsj.com
(END) Dow Jones Newswires
January 26, 2016 18:08 ET (23:08 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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