American Express earnings beat, but revenue falls short of expectations
American Express beat Wall Street earnings expectations for the second quarter, as the credit card company's members spent more.
The company reported net income of $1.27 per share on revenue of $8.25 billion. Analysts had expected it to report earnings excluding items of $1.22 a share on $8.28 billion in revenue, according to a consensus estimate from Thomson Reuters.
Loss provisions rose 29 percent from a year earlier, to $561 million. The company said it had a lower level of write-offs, but it also drew down less from past reserves.
U.S. Card Services reported second-quarter net income of $743 million, up 3 percent from $718 million a year ago. However, return on equity fell 3 percentage points in the quarter to 23.6 percent.
"We generated record bottom-line results this quarter, despite an uneven global economy," Chairman and CEO Kenneth Chenault said in a statement. "Cardmember spending grew by 7 percent [8 percent adjusted for foreign currency translations], with broad-based gains throughout the business both here in the U.S. and internationally," Chenault said.
Following the earnings announcement, shares of the company's stock slipped in after-hours trading, last down 1 percent at $76.00.
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