The insurer posted earnings of $1.21 a share, excluding items, on revenue of $8.63 billion. After-tax operating income increased 23 percent from the same period last year to $1.7 billion, the company said in a release.
Analysts had expected the firm to post earnings of $1.09 a share on revenue of $8.6 billion.
Following the report, AIG's shares rose more than 1 percent in after hours trade.
"I am excited to lead AIG forward and further build on our capabilities to serve all our stakeholders," AIG President and CEO Peter Hancock said in a release.
"The solid third-quarter results were driven by consistent performance across our businesses," he said, adding that the board has authorized share repurchases of $1.5 billion going forward.
In the third quarter, AIG repurchased 24.8 million shares of common stock, the release said.
Incorporated in 1967, American International Group provides insurance services to more than 90 million clients around the world.
The insurer is at the center of a lawsuit by former CEO Hank Greenberg that questions whether or not the methods used by the federal government's bailout of the firm in 2008 were legal.
On Friday, AIG agreed to pay a $35 million penalty for violations related to former subsidiaries that solicited insurance business in New York without a license, the New York State Department of Financial Services said.
Internally, the company's leadership has experienced some upheavals in the last quarter.
In September, former JPMorgan Chase executive Peter D. Hancock succeeded Robert H. Benmosche as President and CEO of AIG.
Later that month, Jay S. Wintrob stepped down from his position as president and CEO of the insurer's life and retirement unit. Michael R. Cowan, executive vice president and CEO, also announced his retirement.
A new operating committee of 13 members was created at the same time.
Correction: AIG is an insurer. The nature of its business was misstated in an earlier version of this article.