Shares of the bank were up 3.5% to $47.26 before the bell.
Adjusted net income rose to $4.15 billion, a 3.8% year-over-year increase, and per-share earnings of $1.30 were a penny higher than a year earlier. Book value per share climbed 6% to $66.25, while its Basel III Tier 1 Common Ratio of 10.4% was up from 9.3% a year earlier.
Excluding CVA/DVA adjustments, revenue slipped 2% from a year earlier to $20.1 billion.
Analysts' estimates averaged by Thomson Reuters pointed to net income of $1.14 a share on revenue of $19.37 billion.
Lower revenue was as expected given how the industry as a whole has suffered more conservative fixed-income trading and soft mortgage lending.
The third-largest U.S. bank said fixed-income markets revenue declined 18% year over year to $3.9 billion. JPMorgan (JPM), the largest U.S. bank by asset portfolio, recently reported a 26% year-over-year decline in its fixed-income segment.
"Despite a quarter that was difficult for our company, we delivered strong results," said Citigroup CEO Michael Corbat in a statement. "Both our consumer and institutional businesses performed well and we grew both loans and deposits while holding the line on our expenses."
Contributing to the better-than-expected quarter, New York-based Citigroup narrowed its adjusted net loss from Citi Holdings to $292 million from $798 million in the year-ago quarter. Citi Holdings consists of the bank's troubled assets, residual segments from the financial crisis and aren't considered part of the bank's core business.