Despite a first-quarter net loss of $183 million, American International Group Inc. is making “tangible progress” on a strategic plan announced in January to streamline the company and provide greater returns to shareholders, according to President and CEO Peter Hancock.

During an earnings call Tuesday morning, Mr. Hancock called the quarter “a solid start to the year.” He attributed the losses, which compared with net income of $2.47 billion a year earlier buoyed by asset sales, largely to hedge funds.

Net written commercial property/casualty premiums for the first quarter fell 14.7%, to $4.31 billion. Investment income for the commercial property/casualty operations fell 43.7%, to $577 million. Catastrophe losses rose 212.7%, to $222 million, but the combined ratio improved slightly to 96.9% from 97.1%.

Analysts greeted the results with a measured response.

“The overall results were obviously worse than expected, but under the hood, the numbers looked more in-line with our expectations,” Paul Newsome, a managing director with Sandler O'Neill & Partners L.P. in Chicago, wrote in a note. “Almost the entire difference between our estimate and the actual number can be attributed to worse-than-expected investment results. Hedge funds and other alternative investment returns were down across AIG's businesses.”

“The main differences to our estimates include weaker investment income impacting several business units, higher commercial catastrophe losses and higher than forecast corporate segment losses,” Mark Dwelle, an analyst with RBC Capital Markets Inc. in Richmond, Virginia, wrote in a note. “While certainly not a strong result, it was a better quality of miss than recent quarters.”

“No one disagrees that this is a big miss, and a messy quarter,” but “the company is making progress,” wrote Joshua Stirling, a senior analyst at Sanford C. Bernstein & Co. L.L.C. in New York. “With the balance sheet stabilizing, and loss ratio and expenses improving, the company is on a road to repair — and when the operating initiatives are paired with the firm's narrower, and more realistic operating strategy, packaged with a big commitment to buybacks, shareholders can't help but benefit.”

That repair includes the insurer's plan to spin off operations, led by its mortgage unit, after calls from high-profile investor Carl Icahn to break into three companies — property/casualty, life insurance and mortgage guaranty insurance — to enhance value and remove the “systemically important financial institution” designation imposed on AIG by the federal Financial Stability Oversight Council. The SIFI designation subjects financial institutions to increased reporting requirements and other regulatory oversight by the Federal Reserve.

MetLife Inc. — which with AIG and Prudential Insurance Co. was one of three insurers designated as SIFIs — recently won its court challenge to the designation when a U.S. District Court judge ruled that FSOC had failed to follow its own rules in imposing the designation. The government has appealed.

When asked what impact the MetLife ruling would have on AIG, Mr. Hancock said the “decision certainly raises the opportunity should it be favorable to consider that down the road.” But he said that the current SIFI designation does not affect the company's objectives as outlined in January's strategic update.