American Express (AXP) reported mixed results for the second quarter, with earnings that topped analysts’ projections while revenue came in shy of expectations and guidance was reiterated for the year.
Adjusted earnings rose to $2.07 a share from $1.84 a share previously, ahead of the consensus on Capital IQ for $2.02 a share. Total revenue climbed 8% to $10.84 billion, but that was shy of the Street’s view for $10.86 billion.
“Once again, our performance was driven by a well-balanced mix of spending volumes, lending income and card fees,” said Steve Squeri, the company’s chief executive. “I feel very good about the power of our business model and our returns on the investments we’ve been making to drive share, scale and relevance.”
Squeri said card member spending adjusted for foreign exchange rose 7%, and that was led by consumers at a time when the economy is “growing at a steady, but modest pace relative to 2018.”
In the global consumer services group, net income fell 4% to $738 million while revenue net of interest expense climbed 10% to $5.8 billion because of higher loans, spending by members and card feeds. Provisions for losses were driven by higher net lending write-offs, rising 15% to $650 million.
Global commercial services net income rose 14% to $644 million and revenue gained 7% to $3.4 billion, which was also attributed to higher spending by card members. Merchant and network services income rose 16% to $632 million and revenue increased 5% to $1.7 billion.
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