Shares of Wells Fargo & Co. WFC,
Friday dropped 2.5% in premarket trading after the bank reported fourth-quarter profit for the first time in six quarters that exceeded expectations, but revenues fell more than expected as lower interest rates weighed on net interest income. Net income rose to $ 2.99 billion, or 64 cents a share, from $ 2.87 billion, or 60 cents a share in the same period a year ago. FactSet’s consensus was for earnings per share of 59 cents. Total sales fell 9.7% to $ 17.93 billion, failing to meet the FactSet consensus of $ 18.12 billion as all business segments of the bank saw sales decline. Net interest income fell 17% to $ 9.28 billion, below the FactSet consensus of $ 9.35 billion. Consumer banking and credit revenues declined 5% to $ 8.61 billion, as an 8% decline in consumer and small business revenues and a 7% decline in credit card revenues offset a 2% increase in home loans. “While our financial performance improved and we earned $ 3.0 billion in the fourth quarter, our results continued to be impacted by the unprecedented operating environment and the work required to move beyond our substantial past troubles,” said Chief Executive Charlie Scharf. The stock is up 51.4% in the last three months through Thursday, while the SPDR Financial Select Sector ETF XLF,
is up 26.0% and the S&P 500 SPX,
has gained 9.0%.