American Express Says Coronavirus Pandemic Hit Volumes

By Allison Prang

American Express Co. more than tripled its provision for credit losses and its chief executive said the coronavirus pandemic weighed on cardholder spending.

Chief Executive and Chairman Stephen Squeri said the Covid-19 pandemic "dramatically impacted our volumes" and said the company is "aggressively" lowering its costs. Mr. Squeri also said the company is committed to not laying anyone off for the rest of the year because of the pandemic.

Quarterly revenue at the company -- which includes card fees and money from interest -- slipped by half a percent to $10.31 billion. That was under analysts' consensus of $10.71 billion, according to FactSet. Net interest income rose at American Express, but the company's noninterest revenue -- its larger revenue driver -- declined.

The company more than tripled its provisions for credit losses, which was $2.62 billion, up from $809 million a year earlier.

Banks in the first quarter also stowed away money to cover credit losses. Various financial tech companies, including American Express, have also dialed down their offers to small businesses to refinance.

The financial-services company's net income was $367 million, down 76% from a year earlier. Earnings were 41 cents a share, down from $1.80 a share. Those results were below the $1.46-a-share consensus from analysts.

Adjusted earnings were $1.98 a share. Those topped the consensus of $1.75 a share.

Write to Allison Prang at allison.prang@wsj.com

(END) Dow Jones Newswires

April 24, 2020 08:01 ET (12:01 GMT)

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