American Express Income Grows on U.S. Strength

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American Express Co. (NYSE: AXP) today reported third quarter results after markets closed Wednesday night. The financial services company reported diluted earnings per share (EPS) of $1.25 on revenues net of interest expense of $8.3 billion. In the same period last year the company reported EPS of $1.09 on revenues of $7.86 billion. The consensus estimate called for EPS of $1.22 on revenues of $8.19 billion.

Currency translation effects cost Amex 1% of revenues. The company’s loss provisions totaled $492 million at the end of the third quarter, up 3% from $479 million a year ago due to lower releases from loss reserves and a benefit from lower write-offs this year.

Net income from the U.S. card services segment rose 12% to $782 million and international card services net income fell 13% to $142 million. Net income also rose in the global commercial services segment (+43%) and the global network and merchant services segment (+9%).

The company’s CEO said:

Despite an uncertain environment, we generated a healthy increase in revenues and stronger Card Member spending across all regions this quarter. Spending on our global network rose 7 percent (9 percent adjusted for currency translations) and Card Member loans continued the modest growth rates we have been seeing for the past several quarters. Credit quality indicators remained at historically strong levels. And, year to date, we are delivering on the annual targets we set to contain operating costs.

For the 2013 fiscal year, consensus estimates call for EPS of $4.88 on revenue of $32.89 billion. The consensus fourth-quarter estimates call for EPS of $1.24 on revenues of $8.5 billion. Today’s report from American Express did not offer any guidance.

Shares rose about 0.2% to $76.45 in after-hours trading Wednesday. The 52-week range is $53.02 to $78.63. Prior to today’s release Thomson/Reuters had a consensus price target of around $79.40 on the company’s shares.