American Express Revenue, Profit Rise -- Update

Date : 07/19/2019 @ 2:19PM
Source : Dow Jones News
Stock : Costco Wholesale Corporation (COST)
Quote : 279.92  4.24 (1.54%) @ 10:16PM

American Express Revenue, Profit Rise -- Update

Costco Wholesale (NASDAQ:COST)
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2 Months : From Jun 2019 to Aug 2019

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By Kimberly Chin 

Revenue at American Express Co. was lifted in the latest quarter by higher card-member spending, loans and card fees, though expenses from rewards programs also increased.

Total revenue, net of interest expense, rose 8.4% to $10.84 billion for the quarter. Analysts surveyed by FactSet expected revenue of $10.83 billion.

Discount revenue, which reflects the fees charged to merchants for accepting AmEx cards, was $6.58 billion, a 6.2% gain from a year ago. Net card fees rose 17% for the quarter.

Card-member rewards expenses, including the points that AmEx pays when cardholders redeem for hotels, airfare and other rewards, rose 9% to $2.65 billion.

Total expenses were up 9.2% driven by card-member spending, consumers using card benefits more frequently and continued investments in co-brand partnerships, the company said Friday.

In recent years, AmEx has promoted lending to its card member base to help boost revenue following the loss of card partnerships, including that with Costco Wholesale Corp.

Card-member loans rose 10% from a year ago to $83.2 billion The company generated $2.76 billion from interest on loans, up 16% from the year prior.

AmEx said its provision for losses was $861 million in the quarter, a 6.8% increase from a year earlier. Its loss reserve as a percentage of loans was 2.6% up from 2.4% a year earlier.

AmEx reported second-quarter profit of $1.76 billion, or $2.07 a share, up from $1.62 billion, or $1.84 a share, a year earlier. Analysts were looking for $2.03 a share.

Write to Kimberly Chin at kimberly.chin@wsj.com

 

(END) Dow Jones Newswires

July 19, 2019 09:04 ET (13:04 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.

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