Discover Financial Results Miss Estimate; Stock Down 4%

(RTTNews) - Discover Financial Services (DFS) on Wednesday reported fourth-quarter net earnings to stockholders of $392 million or $0.87 per share compared with $588 million or $1.23 per share last year.

Excluding items, adjusted earnings for the quarter were $1.19 per share.

Revenues net of interest expense for the quarter were $2.04 billion compared with $2.13 billion in the prior year.

Analysts polled by Thomson Reuters estimated earnings of $1.30 per share on revenues of $2.2 billion for the quarter. Analysts' estimates typically exclude special items.

The company's provison for loan losses for the quarter increased to $457 million from $354 million a year ago.

Direct banking expenses increased $77 million, or 10%, from the prior year due to the impairment of goodwill related to the home loans platform, as well as increased marketing spend, professional fees related to technology investments and employee compensation including higher headcount.

Total loans for the quarter rose 6.4% from the prior year to $70 billion.