American Express beat earnings and revenue estimates last quarter amid rising retail spending, but opted to maintain its guidance.
Earnings were US$4.28, up from $3.64 one year ago and above the Zacks consensus estimate of $4.03. Revenue rose 11% to $18.91 billion, passing estimates by 1.55%.
“We had a very strong start to the year, reflecting continued momentum across our premium customer base and execution of our proven growth strategy,” said chair and CEO Stephen Squeri.
“We delivered 10 percent FX-adjusted revenue growth and 18 percent EPS growth in the quarter. Card Member spending grew 9 percent FX-adjusted, the highest quarterly growth in three years, driven by strong demand and engagement with our premium products.”
Discount revenue rose 9% to $9.52 billion, while net card fees climbed 18% to $2.75 billion.
Total interest income increased 9% to $6.67 billion. Provisions for credit losses were up 9% to $1.25 billion.
Billed business, which represents total spending on AmEx cards, grew 10% to $428.0 billion.
Retail spending was up 11%, CFO Christophe Le Caillec told Reuters, with luxury retail surging 18%.
The company reaffirmed its full year guidance, which includes 9-10% revenue growth and earnings per share of $17.30-17.90. It will also raise its spending on marketing and technology “to capitalise on long-term growth opportunities,” Squeri said.
Shares in American Express (NYSE: AXP) closed 4.3% lower at $318.55, but climbed 0.1% after-hours. Its market capitalisation is $218.46 billion.
