E*Trade meets forecasts

E*Trade met consensus earnings estimates in the first quarter on higher-than-expected revenue.

After market close Tuesday, the online provider of brokerage and other financial services reported first-quarter net income of $868,000, or breakeven on a per-share basis, excluding special items. E*Trade (NYSE: ET) posted first-quarter revenue of $330 million, down 21 percent year-over-year, but more than the $319.5 million predicted by First Call's survey of analysts.

Shares of E*Trade were unchanged in after-hours activity on the Island ECN, immediately following the release of quarterly results. E*Trade rose $1.32 to $7.55 in Tuesday's regular trading ahead of the news.

Including goodwill write-downs, investment gains and losses and other charges, E*Trade lost $7.2 million, or 2 cents per share for the first quarter, which ended March 31.

E*Trade added 116,112 new accounts to end the March quarter with 3.7 million total accounts.

Banking customers of E*Trade added more than $500 million in deposits during the quarter as the company focused on cross-selling between the brokerage and banking units.

Unlike other online brokerages, which have cut staff recently in response to a slowdown in stock trading as the market has declined over the last several months, E*Trade has not announced any major reductions.

"Despite the current economic slowdown, E*Trade continued to demonstrate the strength and flexibility of our business model," said Christos M. Cotsakos, chairman and CEO. "Our focus continues to be straight-forward: manage the business for long-term growth, continue to meet the needs of our customers and build ongoing shareowner value. We're accomplishing this by leveraging cost efficiencies across the entire organization, increasing penetration of households by deepening customer relationships, offering innovative new products and capitalizing on new revenue streams."

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