Revenues of credit card company American Express (NYSE: AXP) increased in the second quarter and surpassed the estimates, driving the bank’s stock higher early Friday. Earnings also rose from last year and came in above the Street view. The company reaffirmed its full-year earnings and revenue guidance.
The New York-based firm reported adjusted earnings of $2.07 per share for the second quarter, up 13% from last year. Earnings also came in above analysts’ forecast. Net income, on a reported basis, advanced to $1.76 billion or $2.07 per share during the three-month period from $1.63 billion or $1.84 per share a year earlier.
There was an 8% growth in consolidated revenues to $10.84 billion, which reflects an increase in cardmember spending and loan volumes. Total cardmember spending, adjusted for foreign exchange, was up 7% year-over-year. The top-line exceeded Wall Street’s projection.
There was an 8% growth in consolidated revenues, which reflects an increase in cardmember spending and loan volumes
Provisions for losses increased 7% to $861 million as net lending write-offs increased amid strong loan growth. There was a 9% increase in consolidated expenses to $7.8 billion, reflecting an uptick in rewards and other customer engagement costs.
“We continued the broad-based momentum throughout our business with the eighth straight quarter of FX-adjusted revenue growth at 8 percent or better. Once again, our performance was driven by a well-balanced mix of spending volumes, lending income and card fee,” said CEO Steve Squeri.”
Reaffirming the earlier guidance, the management said it expects full-year adjusted earnings to be in the range of $7.85 per share to $8.35 per share and unadjusted earnings between $7.64 per share and $8.14 per share.
Earlier this week, Citigroup (C) posted a 20% increase in second-quarter earnings to $1.95 per share, aided by a 2% rise in revenues. Goldman Sachs (GS) reported lower earnings and revenues for the latest quarter as its main business segments witnessed a slump.
American Express shares gained modestly in the premarket trading Friday after closing the previous session higher. The stock has gained 34% since the beginning of 2019 and 28% in the last twelve months.