American Express Says Coronavirus Pandemic Hit Volumes
April 24 2020 - 8:16AM
Dow Jones News
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)
Copyright (c) 2020 Dow Jones & Company, Inc.
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