American Express Expects Earnings to Rise in 2020 -- Update
25 January 2020 - 3:40AM
Dow Jones News
By Allison Prang
American Express Co.'s fourth-quarter profit beat Wall Street's
expectations and the credit-card company gave an optimistic
earnings outlook for 2020.
The company on Friday reported a profit of $1.69 billion, or
$2.03 a share, for the quarter, 2 cents ahead of what analysts
polled by FactSet were expecting. Earnings were down 16% from a
year earlier, when American Express recorded an income-tax
benefit.
The company expects earnings for 2020 to be between $8.85 and
$9.25 a share and revenue, adjusted for foreign-exchange impact, to
rise between 8% and 10%, Chief Executive and Chairman Stephen
Squeri said in prepared remarks. Analysts are guiding for earnings
to be within that range.
Shares of the company rose 3% Friday morning.
Total revenue net of interest expense was $11.37 billion in the
quarter, meeting analysts' consensus estimate. Revenue was up more
than 8% from the comparable quarter a year earlier.
Net card fees were $1.08 billion, up from $897 million. American
Express is expecting that revenue segment to continue to grow the
fastest in 2020, Chief Financial Officer Jeffrey Campbell said on
the company's earnings conference call Friday. For 2019, that
revenue line increased 17% from a year earlier.
In the fourth quarter, total expenses increased more than 8% to
$8.36 billion.
While the company's expenses rose more than expected in the
fourth quarter, investors are more focused on the company's revenue
and earnings hitting targets, Nomura Instinet analysts said in a
note.
Write to Allison Prang at allison.prang@wsj.com
(END) Dow Jones Newswires
January 24, 2020 11:25 ET (16:25 GMT)
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