American Express revenues rose to $ 10.24 billion from $ 7.68 billion last year, the company reported Friday.
Spending on restaurants, boutiques and entertainment venues is back on track as coronavirus vaccines become more common – and that spending has fueled revenue growth on American Express during the second quarter.
The momentum picked up as the quarter progressed, the company said Friday, particularly spending by younger customers.
“We’ve seen card members’ spending accelerate from the previous quarter and exceed pre-pandemic levels in June, with most of this spending growth coming from Millennial, Gen Z and small business customers, ”he said. said President and CEO Stephen Squeri in a statement.
Revenue, net of interest expenses, jumped to $ 10.24 billion from $ 7.68 billion last year, stronger than the $ 9.47 billion Wall Street was looking for, according to a survey by Zacks Investment Research.
Shares of American Express Co. rose 3.4 percent at the opening bell.
Demand for tariff-based Platinum Cards is growing stronger, Squeri said, and American Express registered 2.4 million new cards in the quarter.
The New York company earned $ 2.28 billion, or $ 2.80 per share, for the three months ended June 30. A year earlier it had earned $ 257 million, or $ 0.29 per share. The current quarter included $ 866 million in credit reserve versions.
This easily beats and $ 1.64 projections from industry analysts.
American Express’s consolidated provisions for credit losses brought a profit of $ 606m for the current quarter. This is mainly due to lower reserve releases and net withdrawals. The period a year ago had a supply cost of $ 1.6bn, which was mainly due to a significant credit reserve that built the implemented society as it dealt with the repercussions of the pandemic.
American Express has had success in the pandemic, with fewer Americans traveling, eating out or shopping. Expenses for corporate and individual charges and credit cards are down, and those who maintained a revolving balance have paid off their debts.
That cost freeze is thawed as infections precipitated during the vaccine roll-out.
Infections have begun to appear in some regions of the country where vaccination rates are low. COVID-19 cases have nearly tripled in the United States in the past two weeks amid a vaccine disinformation assault targeting hospitals.
At this time, growing infections in some regions of the United States do not seem to be very concerned about the high and growing vaccination rate in some parts of the country.
“We are increasingly optimistic that the momentum we will generate will continue given the strength we see in our core business, particularly in the United States, even though the pace of recovery remains uneven in different regions of the world,” he said. Squeri. “Based on current trends, we are confident in our ability to be at the top of the range of EPS expectations we have for 2020 by 2022.”
Earlier this month American Express said it was increasing benefits – and tax – on its Platinum tip card. The annual fee goes from $ 550 to $ 695.