Despite declining revenue from online stock trading,
said it exceeded second-quarter earnings expectations and indicated that it should meet analysts' estimates for the full year.
After the market closed on Wednesday, E*Trade posted second-quarter earnings of $32.8 million, or 9 cents a share, compared with a loss of $10.2 million, or 3 cents a share, in the year-ago period, when calculated according to generally accepted accounting principles.
The company reported second-quarter earnings from continuing operations of $38.8 million, or 11 cents a share, compared with $5.4 million, or 2 cents a share, a year ago. On that basis, analysts polled by First Call were expecting 10 cents a share.
For the full year, the company expects to earn 45 cents a share, which would be a penny ahead of the current First Call consensus.
Net revenue rose to $316.1 million from $308.2 million in the same quarter a year ago. Revenue from the company's brokerage business fell to $215.1 million from $229.3 million, but E*Trade Bank picked up the slack. The company's banking division saw second-quarter revenue climb to $100.9 million from $78.9 million in the comparable year-ago period.
Like its online trading competitors, E*Trade was been hurt by a dwindling consumer appetite for electronic stock trading as the market has slumped.
The Menlo Park, Calif., company said the number of active global brokerage accounts rose 7% to 3.6 million from 3.4 million in the year-ago quarter. E*Trade added 34,694 new accounts in the quarter, a 66% drop from the same time last year when the company signed up 103,489 new accounts.
E*Trade conducted 7 million brokerage transactions in the quarter, down 6% from a year ago, but up 13% from the first quarter. The company averaged 108,664 transactions a day, down 8% from last year, but a 6% increase from the first quarter.
Excluding the recently acquired operations of Tradescape, E*Trade conducted an average of 82,790 transactions a day, a 30% decline from a year ago and a 19% drop from the first quarter.
In a press release, the company said it increased its Internet banking offerings, including mortgages, retired $15 million in debt and saw an increase in the interest rate spread at E*Trade Bank.
"Our ability to make strategic acquisitions and leverage our integrated technology-based platform enables us to continue expanding and enhancing our financial services solutions to best meet our customers' unique needs," Christos Cotsakos, the chairman and chief executive of E*Trade, said in a statement.
"Moving forward, we remain focused on accelerating our cross-selling and up-selling initiatives based on our relationships with customer households," he continued. "Given the strength of our balance sheet and flexibility of our model, E*Trade Financial should be well positioned to maximize opportunities that will deliver long-term value to our customers, shareowners and stakeholders, and drive long-term growth in our strategic business units."