clearn.png
Monday October 18th, 2021 12:03AM

AmEx profits plunge as travel spending comes to a standstill

By The Associated Press
Related Articles
  Contact Editor

CHARLOTTE, N.C. (AP) — American Express' fourth-quarter profits dropped by 39%, the credit card giant said Friday, as the pandemic's deep impacts on travel, entertainment and dining dramatically impacted the company's results.

The New York-based company earned $1.07 billion, or $1.30 a share, down from $1.76 billion, or $2.08 per share, in the same period a year earlier. The results missed analysts' forecasts, who were looking for AmEx to earn $1.39 a share, according to Zacks Investment Research.

While AmEx has not been as negatively impacted by defaults and delinquencies like other credit card companies, the company's bottom line has been hit hard by its business model tied into the well-to-do traveling and dining out. Restaurants have been shuttered in many countries, and hotel and airfare usage has fallen to the point that many airlines have sought government help and hotels are facing bankruptcy.

“We recognize that the road ahead continues to be uncertain,” said AmEx CEO Stephen Squeri, in a prepared statement.

AmEx's discount revenue, or the money it makes off of each swipe or tap of an American Express card, was roughly $4.99 billion in the quarter. That's down from $6.83 billion in the same period a year earlier. AmEx earns a small percentage from each transaction on its network, so the less activity on its network, the less revenue the company generates.

The company is also facing consumers and small businesses, hit hard by the pandemic or preparing for more tough times, cutting back spending and cutting up cards. The average spending on an AmEx card fell to $4,486 from $5,630 a year earlier. The average numbers of cards was 90.8 million in the quarter, down from 93 million a year earlier.

  • Associated Categories: Associated Press (AP), AP Business, AP Business - Industries, AP Business - Financial Services, AP Business - Personal Finance
© Copyright 2021 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
Trump, Biden frame closing appeals for sprint to election
President Donald Trump and Democrat Joe Biden are ready to package their divergent personal styles and policy prescriptions into closing messages for the final sprint to Election Day
12:37PM ( 12 minutes ago )
AmEx profits plunge as travel spending comes to a standstill
American Express’ fourth-quarter profits dropped by 39% as the pandemic’s deep impacts on travel, entertainment and dining dramatically impacted results of the credit card giant
12:36PM ( 13 minutes ago )
Spain PM appeals for public unity, sacrifice in virus fight
Spanish Prime Minster Pedro Sánchez is appealing for Spaniards to pull together and defeat the new coronavirus, warning: “The situation is serious.”
12:35PM ( 15 minutes ago )
Associated Press (AP)
Stocks are down on Wall Street as more earnings come in
Stocks are modestly lower on Wall Street, following gains in European markets, as more U.S. companies report results for the summer earnings period
12:05PM ( 44 minutes ago )
Libyan factions sign countrywide UN-brokered cease-fire
The rival sides in Libya’s conflict have signed a permanent cease-fire
11:37AM ( 1 hour ago )
NATO chief says Greece, Turkey agree to cancel war games
NATO Secretary-General Jens Stoltenberg says that Greece and Turkey are going to cancel war games scheduled for next week on each other’s national holidays, in a further sign of easing of tensions between the two NATO allies and historic rivals
11:31AM ( 1 hour ago )
AP Business
More solid earnings reports send US stock indexes higher
Stocks are opening slightly higher on Wall Street, following gains in European markets, as more U.S. companies report encouraging results for the summer earnings period
9:43AM ( 3 hours ago )
Veggie burgers are still burgers, EU lawmakers rule
European lawmakers say that plant-based products that do not contain meat can continue to be labeled “sausages” or “burgers.”
9:20AM ( 3 hours ago )
The Latest: Spain PM asks for unity during coronavirus surge
Spanish Prime Minister Pedro Sánchez appealed to Spaniards to pull together and defeat the coronavirus, warning: “The situation is serious.”
9:08AM ( 3 hours ago )
AP Business - Industries
Fed survey finds tepid growth as US economy battles pandemic
A Federal Reserve survey of business conditions around the country has found that the U.S. economy grew at a “slight to modest” pace in September and early October
6:53PM ( 1 day ago )
Report showing gains in bank access overshadowed by COVID
The Federal Deposit Insurance Corp. said Monday more Americans than ever obtained a basic bank account in 2019
2:17PM ( 3 days ago )
IMF: Nearly all Mideast economies hit by pandemic recession
The International Monetary Fund's latest report shows that the coronavirus pandemic has pushed nearly all Mideast nations into the throes of an economic recession this year
8:03AM ( 4 days ago )
AP Business - Financial Services
The Latest: Final debate ends on different tone than 1st one
The second and final debate between President Donald Trump and Democratic nominee Joe Biden has ended, with a remarkably different tone than their first meeting
10:59PM ( 13 hours ago )
The Latest: Biden, Trump spar over nation's reliance on oil
Democrat Joe Biden and President Donald Trump are sparring over the nation’s reliance on oil -- and what needs to be done to reduce future emissions
10:53PM ( 13 hours ago )
The Latest: Candidates offer disparate inauguration messages
To close out Thursday night’s presidential debate, both President Donald Trump and Joe Biden offered very divergent versions of what they’d tell Americans who didn’t support them on a hypothetical Inauguration Day
10:49PM ( 14 hours ago )
AP Business - Personal Finance
Trump, Biden frame closing appeals for sprint to election
President Donald Trump and Democrat Joe Biden are ready to package their divergent personal styles and policy prescriptions into closing messages for the final sprint to Election Day
12:37PM ( 12 minutes ago )
Spain PM appeals for public unity, sacrifice in virus fight
Spanish Prime Minster Pedro Sánchez is appealing for Spaniards to pull together and defeat the new coronavirus, warning: “The situation is serious.”
12:35PM ( 15 minutes ago )
Parties' late spending on Senate races shows GOP's jeopardy
Republicans and Democrats are unleashing millions in eleventh-hour spending in Senate races
12:23PM ( 26 minutes ago )
Census takers fall short of target goal in areas of US
From tribal lands in the Southwest to storm-battered Louisiana, the U.S. Census Bureau did not achieve its goal of reaching 99% of households during the 2020 census
12:17PM ( 32 minutes ago )
Veggie burgers are still burgers, at least in Europe
European lawmakers say that plant-based products that do not contain meat can continue to be labeled “sausages” or “burgers.”
12:15PM ( 34 minutes ago )