Net income fell to $3.4 billion, or $1.58 per share, in the three months ended March 31, the bank said on Friday. That compares with $4.6 billion, or $2.19 per share, a year earlier.
"Last month marked the end to the organizational simplification we announced in September," Fraser said in a statement. "The result is a cleaner, simpler management structure that fully aligns to and facilitates our strategy."
Shares in the third-largest U.S. lender rose 2.5% in early trading.
CFO Mark Mason said the headcount reduction of 7,000 will appear in data over the next few quarters as the average notice period for laid-off employees was about 90 days.
The lender expects an annual savings of $1.5 billion from overhaul, it said in an investor presentation.
The bank also paid $251 million into a Federal Deposit Insurance Corp (FDIC) fund that was drained last year after three regional lenders failed.
Excluding one-time items, Citi's adjusted profit of $1.86 per share sailing past Wall Street expectations of $1.23 each, according to LSEG data.
"Citigroup's 1Q results were healthy and demonstrated that the company continues to make progress on its transformation," said Ian Lapey, portfolio manager at Gabelli Funds, which hold shares in the bank.
Revenue fell 2% on a reported basis to $21.1 billion in the first quarter. Excluding one-off items such as the sales of businesses last year, it was higher in the quarter.
It forecast revenue between $80 billion to $81 billion for 2024, about 1.8% to 3% higher than $78.5 billion in 2023.
"There's a lot of risks out there," CFO Mason told reporters on a conference call.
"The global economy seems to be resilient. I think that we do expect that there will be a slowdown in growth through 2024, but when you look at the labor markets and the strength of the consumer, that seems to be holding up."
SEGMENT REVENUE
Performance at Citi's services and banking divisions stood out.
Revenue from the business that provides cash management, clearing and payments services for the world's biggest corporations rose 8% to $4.8 billion, buoyed by an 18% jump in securities services revenue to $1.3 billion.
Meanwhile, a resurgence in capital markets and investment banking fees fueled a 49% surge in banking revenue to $1.7 billion. Corporate lending rose 34%.
Markets were a sore spot. Trading revenue fell 7% to $5.4 billion, dragged lower by fixed income and currencies.
Wealth management revenue shrank 4% to $1.7 billion.
While Citi's consumer banking division grew revenue, it also stockpiled more money to cover potential losses from customers who default on their loans.
The bank said credit costs of $2.2 billion were driven by higher non-conforming loans of $1.9 billion.
Rival JPMorgan Chase (JPM.N) reported a higher first-quarter profit on Friday, while Wells Fargo's (WFC.N) quarterly profit shrank as it earned less from customer interest payments.
REORGANIZATION COSTS
For the full year, bank expects expenses between $53.5 billion to $53.8 billion, excluding the FDIC's special assessment fees.
Its forecast included about $700 million to $1 billion of repositioning costs and restructuring charges, of which roughly $483 million was recorded in the first quarter.
Fraser began a sweeping reorganization in September to simplify the bank and improve performance, pushing up expenses to $14.2 billion.
The largest round of staffing moves, including reassignments and departures, was communicated to employees in late March.
In the previous quarter, Citi had posted a $1.8 billion loss as one-time items dragged down its earnings.
"These past months have not been easy," Fraser wrote in March. "Far from it. The changes we've made are the biggest that most of us have experienced at Citi ..., putting us on the front foot and improving our competitiveness," she had said.
The company's stock has risen 18% this year, outperforming peers and beating the benchmark S&P 500 (.SPX).
The bank still faces challenges, including regulatory problems and an unsettled workforce. In February, Reuters reported U.S. regulators asked Citigroup for urgent changes to the way it measures default risk of its trading partners.
Citi is working to fix problems laid out in two enforcement actions from the U.S. Federal Reserve and the Office of the Comptroller of the Currency from 2020.
The consent orders direct the bank to repair deficiencies in its risk management, data governance and internal controls.
