Charlie Riedel, File, Associated Press
FILE - In this June 23, 2011 photo, Discover cards are podes in Overland Park, Kan. Discover Financial Services said Thursday, Dec. 15, 2011, early holiday spending helped its fourth-quarter profit leap 46 percent.

NEW YORK — Shoppers spent more with Discover cards as the holiday shopping season began, helping lift the credit card company's fiscal fourth quarter profit 46 percent.

Discover Financial Services said Thursday that sales volume on its namesake cards rose 8 percent to $25.03 billion in the quarter. The total number of transactions Discover's networks processed rose 5 percent.

At the same time, customer payment habits improved, and rates of late payments and defaults fell. That enabled the company to release some of its reserves set aside to cover unpaid balances, which also helped improve results.

Reflecting a broader trend across the credit card industry, the Riverwoods, Ill.-based company said the number of customers paying off their card balances each month increased.

Keefe, Bruyette and Woods analyst Sanjay Sakhrani noted that economic shakeout of the last few years has left credit cards in the hands of more affluent consumers who are better able to pay their bills in full each month, while those with lower credit scores and presumably less ability to pay are now less likely to use credit.

For the three months ended Nov. 30, Discover posted net income available to common shareholders of $508 million, or 95 cents per share, compared with $347 million, or 64 cents per share in the year-ago period.

The number of outstanding shares dropped 3 percent, which has the effect of boosting per-share results.

Revenue rose 13 percent to $1.81 billion from $1.6 billion last year.

Analysts, on average, were expecting earnings of 89 cents per share on $1.81 billion in revenue, according to a survey by FactSet.

Growth in the company's private student loan and direct banking businesses provided added boosts during the quarter. During the period, Discover purchased an additional $2.4 billion in student loans.

Analyst Chris Brendler of Stifel Nicolaus said called the results "impressive," and pointed to the growth in student loans and also private loans made by Discover Bank as positive. "It was a good quarter," he said.

Discover said the results enabled it to raise its dividend by 67 percent to 10 cents from 6 cents. The dividend is payable Jan. 19 to shareholders of record as of Dec. 29.

In morning trading, Discover shares slipped 22 cents, to $23.60. The stock has traded between $17.86 and $27.92 in the past 52 weeks, and closed Wednesday up about 30 percent since the start of the year.