Citigroup Gears Up for Q3 Earnings: Analysts Bullish Leading In

Citigroup Inc. (NYSE: C) is just one of the major banks set to release its third-quarter earnings on October 14th, with tomorrow's pre-market session likely to throw up a range of data that could shape sentiment.

Adding to the anticipation, Seaport Research Partners recently revised its EPS estimate for Citigroup's Q3 2025 upwards, from $1.79 to $1.88. This optimistic adjustment signals confidence in Citigroup's ability to deliver solid financial results, driven by factors such as robust client engagement and favorable market conditions.

The average estimate on the street is for Citi to post an EPS of $1.72, a solid uplift on the $1.51 printed during the same quarter YoY. Revenue is expected to have grown 4.27% Y/Y to $21.18billion.

Citigroup's CFO, Mark Mason, previously projected a mid-single-digit growth in investment banking fees and market revenue for Q3 2025 compared to the same period last year. If realized, this growth would underscore the bank's resilience and adaptability in a competitive landscape.

A notable strategic shift occurred earlier this week, with Citigroup downgrading UK equities from “overweight” to “underweight” while upgrading Emerging Markets (EM) to “overweight.” This move underscores the bank's focus on cyclical and AI-driven opportunities in emerging markets, potentially influencing its investment banking and market revenues in the coming quarters.

Looking back at Q2 2025, Citigroup reported a net income of $4 billion, with an EPS of $1.96 and a return on tangible common equity (RoTCE) of 8.7%. Revenues increased by 8%, demonstrating positive operating leverage across various business segments. The Services segment shone with a RoTCE of 23%, while the Markets segment experienced a 16% revenue increase, its best second quarter since 2020.

Citigroup has also been actively returning capital to shareholders. In Q2 2025, the bank distributed over $3 billion, including $2 billion in share repurchases, and increased its quarterly dividend to $0.60 per share, demonstrating a commitment to enhancing shareholder value.

In August, Citigroup raised its year-end forecast for the S&P 500 index to 6,600, citing optimism around enhanced corporate earnings driven by recent tax and spending legislation. This bullish outlook suggests confidence in broader market performance, which could positively impact Citigroup's investment banking activities.

While the prevailing sentiment leans towards optimism, the bull case points to Citigroup's reliance on investment banking and market revenues makes it vulnerable to macroeconomic shocks. If global growth slows down more than anticipated, or if geopolitical tensions escalate, these revenue streams could quickly dry up. The current stock price already reflects a significant amount of expected growth, leaving little room for error.

Furthermore, the strategic shift towards emerging markets carries inherent risks, including political instability and currency volatility.

Ultimately, the market's reaction to Citigroup's Q3 earnings will depend on whether the bank can deliver on these elevated expectations and navigate the complex global landscape. The markets will be keenly observing the earnings report for confirmation of these trends and their potential impact on Citigroup's stock price. The upcoming earnings call will be a key event to gauge the future direction of this financial behemoth.