Consumers who sought relief from the pandemic used their credit cards to eat and dine out and go out on holidays which helped American Express Co to report quarterly profits that beat estimates of the market as the lender allied fears of any large and significant effect of the latest wave of the pandemic caused by the Omicron variant of the coronavirus.
The upbeat results for the quarter by the company helped its shares to surge by 9 per cent as the company reported record levels of spending by its consumers in the fourth quarter with the United States and the world economy continued slow and steady recovery from the Covid-19 pandemic induced slowdown as well as strong jobs market in the US and other markets which encouraged consumers to expend more on their pre-pandemic habits.
The results of the company were also in line with the remarks made by the largest US banks – which have stated that consumers – who still possess cash in the bank, were again interested in spending as well as borrowing.
According to the company’s Chief Financial Officer Jeff Campbell, the current trend is expected to continue well into the current year – more so because the latest pandemic wave caused by the Omicron variant only exhibited a modest impact on travel spending even though thousands of flights had to be canceled.
"When you think about the Delta variant in 2021, and now as you see Omicron in early 2022, each of those impacts has been a little milder than the one before, and we believe shorter in duration," Campbell said.
Based on those anticipations, American Express said that its projected growth in net revenues for 2022 to be 18 per cent and 20 per cent and earnings per share to be between $9.25 and $9.65.
The company would potentially launch a cryptocurrency card, but would also consider the use of the digital asset as a possible redemption option in the future, said company executives on a conference call.
American Expresses’ closets rival Visa Inc already has a number of card programs that allow its customers to earn bitcoin on purchases.
The revenues of American Express excluding interest expense increased by 30 per cent for the quarter ended December 31, with expenses on travel and entertainment increased by more than two folds.
According to Refinitiv statistics, net income was $1.7 billion, or $2.18 per share, which was more than analyst projections of $1.87 per share.
(Source:www.usnews.com)
The upbeat results for the quarter by the company helped its shares to surge by 9 per cent as the company reported record levels of spending by its consumers in the fourth quarter with the United States and the world economy continued slow and steady recovery from the Covid-19 pandemic induced slowdown as well as strong jobs market in the US and other markets which encouraged consumers to expend more on their pre-pandemic habits.
The results of the company were also in line with the remarks made by the largest US banks – which have stated that consumers – who still possess cash in the bank, were again interested in spending as well as borrowing.
According to the company’s Chief Financial Officer Jeff Campbell, the current trend is expected to continue well into the current year – more so because the latest pandemic wave caused by the Omicron variant only exhibited a modest impact on travel spending even though thousands of flights had to be canceled.
"When you think about the Delta variant in 2021, and now as you see Omicron in early 2022, each of those impacts has been a little milder than the one before, and we believe shorter in duration," Campbell said.
Based on those anticipations, American Express said that its projected growth in net revenues for 2022 to be 18 per cent and 20 per cent and earnings per share to be between $9.25 and $9.65.
The company would potentially launch a cryptocurrency card, but would also consider the use of the digital asset as a possible redemption option in the future, said company executives on a conference call.
American Expresses’ closets rival Visa Inc already has a number of card programs that allow its customers to earn bitcoin on purchases.
The revenues of American Express excluding interest expense increased by 30 per cent for the quarter ended December 31, with expenses on travel and entertainment increased by more than two folds.
According to Refinitiv statistics, net income was $1.7 billion, or $2.18 per share, which was more than analyst projections of $1.87 per share.
(Source:www.usnews.com)
