Welcome to the Reuters.com BETA. Read our Editor's note on how we're helping professionals make smart decisions.
Read more
Sign In
April 23, 20214:03 AM PDTLast Updated 4 months ago
Business
AmEx credit spending slump eclipses profit beat, shares fall
ReutersNiket NishantSohini Podder

2 minute read
Credit cards of American Express are photographed in this illustration picture in this March 17, 2016, file photo. REUTERS/Kai Pfaffenbach/Illustration
Summary
Travel restrictions to slow business travel recovery - CFO
Cross-border travel to rebound only in 2022 - CEO
Releases $1.05 bln from credit reserves
April 23 (Reuters) - American Express Co (AXP.N) said on Friday travel and entertainment-related spending on its cards halved in the first quarter as customers stayed at home during the COVID-19 crisis, overshadowing its better-than-expected profit.
Cross-border restrictions and a resurgence of COVID-19 cases in several parts of the world have forced people and businesses to put travel on hold, hitting credit-card issuers.
Chief Financial Officer Jeffrey Campbell said in an interview with Reuters the continued travel restrictions would slow a rebound in business travel for large corporations.
"Our baseline assumption remains that by the fourth quarter of this year, global T&E (travel and entertainment) spending will be at around 70% of 2019 levels. But travel for large and global corporations is going to rebound slower," Campbell said.
Shares of AmEx fell over 2% in afternoon trading.
But Campbell struck a more optimistic tone on overall spending volumes, saying he expected recovery to pre-pandemic levels either later this year or in 2022.
The credit card issuer is already seeing signs of a pick-up in domestic travel thanks to pent-up demand and vaccine rollouts, Chief Executive Officer Stephen Squeri told analysts on a call.
Cross-border travel, however, will bounce back only in the second half of 2022, he said.
The New York-based company's first-quarter revenue fell 12% to about $9 billion, also hit by lower loan volumes.
But AmEx's net income surged six-fold to $2.2 billion as it freed up more than $1 billion of funds it had set aside to cover credit losses from the pandemic.
Excluding that benefit, earnings were $1.74 per share, higher than a Refinitiv IBES estimate of $1.61 per, driven by a rebound in non-travel spending.
Reporting by Sohini Podder in Bengaluru; Editing by Aditya Soni
Our Standards: The Thomson Reuters Trust Principles.
More from Reuters
Play video on original page
Read Next
China
China July factory activity seen growing at a slightly slower pace
8:38 PM PDT
Business
Microsoft looks to tap into India's Oyo before its potential IPO- source
8:27 PM PDT
Asia Pacific
N.Korea's economy shrank most in 23 years amid COVID-19, sanctions - S.Korea c.bank
8:06 PM PDT
Asia Pacific
Japan's output, job availability jump but COVID curbs to slow growth
8:05 PM PDT

Sign up for our newsletter
Subscribe for our daily curated newsletter to receive the latest exclusive Reuters coverage delivered to your inbox.
Business
Business · 6:13 PM PDT
Amazon sales growth slows in tame start to Jassy's tenure as CEO
Amazon.com Inc (AMZN.O) on Thursday said sales growth would slow in the next few quarters as customers venture more outside the home, a tepid start to CEO Andy Jassy's reign after 27 years with Jeff Bezos at the retailer's helm.
Business
Asian shares down, set for worst month since March 2020
7:51 PM PDT
Business
Uber delays office return, makes vaccination mandatory for U.S. employees
3:34 PM PDT
Business
Robinhood closes at $34.82 in grim stock market debut
6:15 PM PDT
Business
Fiscal stimulus, vaccinations lift U.S. economy above pre-pandemic level
3:37 PM PDT
Latest
Home
Media
Videos
Pictures
Graphics
Browse
World
Business
Legal
Markets
Breakingviews
Technology
Investigations
Lifestyle
About Reuters
About Reuters
Careers
Reuters News Agency
Brand Attribution Guidelines
Reuters Leadership
Reuters Fact Check
Reuters Diversity Report
Stay Informed
Download the App
Newsletters
Information you can trust
Reuters, the news and media division of Thomson Reuters, is the world’s largest multimedia news provider, reaching billions of people worldwide every day. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers.
Follow Us
Thomson Reuters Products
Westlaw
Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology.
Onesource
The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs.
Checkpoint
The industry leader for online information for tax, accounting and finance professionals.
Refinitiv Products
Eikon
Information, analytics and exclusive news on financial markets - delivered in an intuitive desktop and mobile interface.
Refinitiv Data Platform
Access to real-time, reference, and non-real time data in the cloud to power your enterprise.
World-Check
Screen for heightened risk individual and entities globally to help uncover hidden risks in business relationships and human networks.
Advertise With Us
Advertising Guidelines
Cookies
Terms of Use
Privacy
Corrections
Site Feedback

All quotes delayed a minimum of 15 minutes. See here for a complete list of exchanges and delays.
© 2021 Reuters. All rights reserved