Why American Express (AXP) Shares Are Trading Lower Today - American Express (NYSE:AXP)

American Express Co AXP reported Q1 revenue (net of interest expense) growth of 22% year-on-year to $14.28 billion, exceeding the consensus of $14.03 billion.
Revenue reached a quarterly record led by strong Card Member spending (+16% Y/Y, on an FX-adjusted basis) and continued increased premium products engagement.
Total Network Volumes grew 14% Y/Y to $398.9 billion.
U.S. Consumer Services revenue was $6.6 billion, up 25% Y/Y. Commercial Services revenue was $3.5 billion, up 15% Y/Y.
International Card Services revenue was $2.5 billion, up 22% Y/Y. Global Merchant and Network Services revenue was $1.7 billion, up 23% Y/Y.
Total expenses rose 22% Y/Y to $11.1 billion due to higher customer engagement costs.
EPS of $2.40 missed the consensus of $2.65.
Provision for credit losses stood at $1.1 billion, up from a benefit of $33 million, reflecting higher net write-offs and a net reserve build of $320 million.
"We acquired 3.4 million new cards during the quarter, with U.S. Consumer Platinum and Gold, U.S. Business Platinum, and Delta co-brand account acquisitions all reaching record levels. Demand from Millennial and Gen Z consumers continues to fuel this growth, accounting for more than 60 percent of all new consumer account acquisitions in the quarter. Millennial and Gen Z customers also continued to be our fastest growing U.S. cohort in terms of spending, growing 28 percent from a year earlier." said Stephen J. Squeri, Chairman and CEO.
American Express CFO says U.S. Goods and Services spending growth rate slowed sequentially, both for consumer and small businesses.
FY23 Outlook: American Express reaffirmed guidance for revenue growth of 15% - 17% (consensus of $60.82 billion) and EPS of $11.00 - $11.40 (consensus of $11.10).
Price Action: AXP shares are trading lower by 5.81% at $155.66 on the last check Thursday.
Photo via Wikimedia Commons

Market News and Data brought to you by Benzinga APIs

-

-

-

-

-

-

-

-

-

-

-

-

-

-

American Express Q1 Earnings: EPS Miss, Raises Provision of Credit Losses, Reiterates Guidance