2023-10-20 16:00:54
© Reuters. Logo da American Express em Los Angeles
25/04/2016 REUTERS/Lucy Nicholson
By Niket Nishant and Jaiveer Shekhawat
(Reuters) – American Express (NYSE:) on Friday reported third-quarter profit that beat expectations, helped by resilient spending by its wealthy customers who shrugged off concerns about an economic recession.
AmEx, which serves a premium customer base, has largely managed to mitigate the impact of inflation and interest rate hikes by the Federal Reserve, which have made borrowing expensive and constrained discretionary spending.
In a sign of caution, however, AmEx increased its provisions for credit losses to $1.23 billion, up 58% from last year, to respond to a greater likelihood that consumers will default on payments. your debts.
Default rates, however, were below pre-pandemic levels, the company said.
“It’s a normal quarter for us,” said chief financial officer Christophe Le Caillec. “We see a lot of demand for our products and services coming from Gen Z and Millennials. They are also signing up for premium products.”
AmEx reported earnings of $3.30 per share, up from $2.47 per share a year earlier. On average, analysts expected earnings of $2.94 per share, according to data from LSEG IBES.
The company also said its full-year earnings per share and revenue were in line with its previous forecast. The company previously said it expects earnings of between $11 and $11.40 per share in 2023.
“Travel and entertainment (T&E) spending remained robust… Restaurant spending was again one of our fastest-growing T&E categories,” Chief Executive Stephen Squeri said in a statement.
Revenue, excluding interest expense, rose 13% to $15.38 billion. Consolidated expenses increased 7% to $11 billion, driven by higher customer engagement costs.
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