That compares with $227 million, or 68 cents, a year ago, when non-cash tax adjustments of 25 cents weighed on earnings.
Analysts had expected State Street to report $1.01 for the quarter, according to Reuters Estimates.
"The biggest positive surprise this quarter was not the numbers, which we had expected to be good, but the raised revenue and earnings forecasts based on the Investors Financial acquisition," RBC Capital Markets analyst Gerard Cassidy said.
Revenue rose 16 percent to a record $1.9 billion from $1.7 billion as State Street wooed new clients and sold more products to existing ones like Merrill Lynch and Bank of America .
State Street, like other asset managers who earn fees based on the amount of money they manage, has benefited from a rise in global stock markets, which helped investment management fees climb 22% while fees for services like record-keeping rose 12%.
Total assets under management grew 26% to $1.93 trillion while total assets under custody rose 20% to $13.04 trillion.
State Street Chairman and Chief Executive Ron Logue raised the year's revenue forecast because business at both State
Street and Investors Financial, a former rival it acquired for $4.5 billion this month, is strong.
For example, customers have already put $10 billion into State Street's 130/30 products, one of the hottest strategies on Wall Street, where managers can employ some techniques often used by hedge funds.
Revenue is now likely to grow between 20% and 22% instead of 16% to 18%, Logue said, adding that operating earnings per share growth will be near the top of the previously announced 10% to 15% range.
Investors Financial has helped State Street cement its position as the biggest provider of services to the fast-growing $1.5 trillion hedge fund industry and the two now have $441 billion in hedge fund assets under administration.
"I feel confident that our position in relation to our traditional competitors is unassailable," Logue told Reuters.
The new group's existing clients will also bring State Street closer to its goal of earning 50% of its revenue abroad, Logue said. Last year 43% of State Street's revenue was earned overseas, mainly in Europe and Asia where business is growing twice as fast as it is here, he explained.
State Street, which competes with Bank of New York, Mellon and Northern Trust as well as large asset managers like Franklin Resources, is trading at 18.5 times future earnings, roughly the same as Bank of New York Mellon but far less than money managers Eaton Vance and Janus Capital, for example, which are both trading above 30 times expected earnings.