Forget the weak economy; charge it to my American Express
Last night, the iconic company posted third-quarter earnings, with revenue net of interest expense rising 9% to $7.6 billion. The increase was attributed to "strong growth in cardmember spending across all business segments," which speaks volumes in the current economic backdrop. Net income rang up to $1.2 billion, or $1.03 per share, up 13% from last year's quarter.
On average, analysts were looking for earnings per share of $0.96 while revenue was right on target. Meanwhile, net margin ticked up to 16.3% from 15.6% in the year-ago quarter.
The bottom line was bolstered by improving credit trends, as Amex's total provision for loan losses fell 33% to $249 million. This ameliorates fears from when the company had previously reported an uptick in delinquencies, alongside Capital One Financial
American Express CEO Kenneth Chenault said, "The overall results are showing the benefit of moves we've made to improve our risk profile, capture a greater share of cardmember spending, grow fee-based revenues and build additional flexibility into the way we manage expenses."
Since American Express is also a lender, unlike Visa
With the company putting up solid numbers during tough times, it's no wonder Warren Buffett loves the stock. As a frequent Blue Cash user with only positive experiences, I can say that American Express delivers a win-win scenario for cardmembers and shareholders alike.
- Add American Express to your Watchlist.