Ameriprise Financial Inc.'s second-quarter profit jumped 18 percent, helped by the federal tax cut and continuing strong investment flows from clients.
Ameriprise shares jumped more than 1 percent in after-hours trading following the company's announcement, which came after regular trading ended Tuesday.
The Minneapolis-based investment advisory company, one of the nation's largest with $891 billion in assets under management, said it earned $462 million, or $3.10 a share. Revenue rose 6 percent to $3.2 billion.
The company's adjusted operating earnings — a measure followed more closely by major investors because it excludes the effect of certain investments and hedging activities at Ameriprise — rose 22 percent to $536 million, or $3.60 a share. Analysts had expected adjusted profit of around $3.50 a share.
James Cracchiolo, called the company's performance "strong" and said in a statement the company's profit for the first six months of the year was a record.
Like many companies in the current quarter, most of the profit gain at Ameriprise came from the effect of the tax cut enacted by Congress and President Donald Trump at the end of 2017. Its pretax income was up 7 percent, compared to the 18 percent jump in the bottom line.
The company said its tax rate was 16.5 percent, below a previously estimated range of 17 to 19 percent and down from last year's 24.5 percent.
Its largest business by revenue, advice and wealth management, had the biggest gain in pretax operating earnings with a 20 percent jump. The gain appeared to show that its retail investor clients remained confident in stocks as an investment despite the market's volatility in first half of the year.
Ameriprise said it returned virtually all of its adjusted operating earnings to shareholders in the form of $400 million in stock buybacks and $132 million in quarterly dividends.