Credit card operator American Express (AXP) reported a 22% jump in earnings for the third quarter as broad-based increases in cardmember spending and fees drove revenues higher. The top and bottom lines came in above analysts’ expectations. The company also raised its full-year 2018 guidance.
Net income for the quarter climbed 22% to $1.65 billion, or $1.88 per share.
Higher spending by the consumer, small business, and corporate card members drove consolidated revenues higher by 9% to $10.14 billion. Higher loan volumes and fee income also contributed to the top line growth. Excluding the impact of foreign exchange rates, adjusted revenues net of interest expense grew 10%.
Revenue from Global Consumer Services Group increased 11% year-over-year on higher loans, cardmember spending, and fee income. Higher cardmember spending drove revenues from Global Commercial Services higher by 9% and that from Global Merchant and Network Services up 2%.
For the third quarter, growth in the loan portfolios and higher lending write-off rate dragged provisions for losses higher by 6%. Consolidated expenses rose 8% on higher rewards and other customer engagement costs.
Looking ahead into the full year 2018, the company lifted revenue growth outlook to the range of 9% to 10% from prior estimate of at least 9%. Adjusted EPS guidance was raised to $7.30 to $7.40 from the prior range of $6.90 to $7.30.
Related: PayPal Q3 Earnings
Today, American Express and PayPal (PYPL) announced an expanded strategic partnership for improving the digital payments experience for US American Express card members paying with PayPal and Venmo.
Shares of American Express ended Thursday’s regular session down 1.44% at $102.84 on the NYSE. The stock has risen over 3% in the year so far and over 11% in the past year.