- **Merger Milestone**: Federal approvals secured; merger with Capital One set to close May 18. 
- **EPS Growth**: 31% YoY increase, supported by margin expansion and stable credit. 
- **Net Interest Margin**: 12.18% (115bps YoY rise). 
- **Deposit Growth**: Direct-to-consumer deposits now 74% of funding. 
- **Credit Health**: Delinquency rate down 18bps QoQ; charge-offs improved YoY. 
- **Capital Strength**: Tier 1 ratio at 14.7%, up 60bps QoQ.

**【CEO Opening Remarks】**
- **Merger Update**: Federal Reserve and OCC approvals secured; merger with Capital One expected to close on May 18, 2025. Shareholders overwhelmingly approved (99% vote). 
- **Q1 Financial Highlights**: 
  - EPS up 31% YoY, driven by net interest margin expansion and strong credit performance. 
  - Card delinquency rate down 18bps QoQ; net charge-offs improved YoY. 
  - Monitoring macroeconomic risks; underwriting strategy remains conservative.

**【CFO Financial Breakdown】**
- **Net Income**: $1.1B (30% YoY growth). 
- **Net Interest Margin**: 12.18% (115bps YoY expansion), driven by lower deposit costs and reduced promotional balances. 
- **Revenue Trends**: 
  - Card sales down 2% YoY due to credit tightening. 
  - Direct-to-consumer deposits grew 6% YoY, now 74% of total funding. 
- **Expenses**: 
  - Compensation up 10% YoY (higher wages, retention). 
  - Legal fees down $20M; civil penalties reduced $45M. 
- **Credit Metrics**: 
  - Net charge-offs 4.99% (7bps higher YoY, 35bps up QoQ). 
  - Allowance for credit losses down $215M QoQ. 
- **Capital Position**: Common equity Tier 1 ratio 14.7% (60bps QoQ increase). 
- **Dividend**: $0.70 per share declared, but no future Discover dividends post-merger.


Discover Financial Services (DFS)-24 Apr 25-2025 Q1 Earnings call transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

DFS(Delisted)

DFS fundamentals

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