U.S. Bancorp ( USB ) shares are trading lower in the premarket session on Thursday.

The company reported fourth quarter adjusted earnings per share of $1.07, beating the street view of $1.05. Quarterly sales of $6.98 billion marginally missed the analyst consensus estimate of $6.996 billion.

The company registered a return on tangible common equity of 18.3%, a return on average assets of 1.03%, and an efficiency ratio of 59.9%, adjusted for notable items.

Positive operating leverage in the quarter under review was 190 basis points, as adjusted for notable items.

“As we move into 2025, we are well positioned to deliver industry-leading returns on tangible common equity and remain confident in our strategy for future growth and our ability to deliver meaningful positive operating leverage,” said Andy Cecere, Chairman and CEO of U.S. Bancorp ( USB ).

Net interest income in the quarter under review rose 0.9% to $4.146 billion. Noninterest income rose 8.1% to $2.833 billion.

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The increase in net income attributable to U.S. Bancorp ( USB ) year-over-year was primarily due to higher total net revenue and lower noninterest expense driven by higher notable items in the prior year quarter, partially offset by an increase in the provision for credit losses.

The net interest margin decreased to 2.71% in the fourth quarter of 2024 from 2.78% in the fourth quarter of 2023.

The company’s provision for credit losses in the fourth quarter of 2024 was $560 million, up from $557 million in the third quarter of 2024 and $512 million in the fourth quarter of 2023.

The increase from the third quarter was $3 million (0.5%), and from the fourth quarter of 2023, it was $48 million (9.4%). The higher provision year-over-year was mainly due to increased losses on credit card and commercial real estate loans.

Outlook: For the first quarter, the company sees relatively stable net interest income compared with the fourth quarter. The company also projects positive operating leverage of +200 bps.

The company sees FY25 revenues to increase 3% to 5% year over year.

The company said it continues to monitor economic uncertainties such as interest rates, inflation, and other factors that could impact borrowers.

Price Action: USB shares are trading lower by 2.46% to $49.65 premarket at last check Thursday.

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