LOS ANGELES, Calif. – American Express says its net income rose 9 per cent in the third quarter, as cardholders spent more in the U.S. and elsewhere. The results trumped Wall Street estimates.
The New York-based company said Wednesday that spending on its global network jumped 7 per cent in the June-September period. It also benefited from growth in income from interest charges, as well as card loans.
American Express cardholders tend to be more affluent than other credit card users, which is one reason the company has done well as the nation’s economy has gradually improved despite a sluggish global economy.
Unlike Visa and MasterCard, which only process transactions, American Express issues its own cards. When cardholders charge more on their AmEx cards, the company earns even more in interest income and a variety of fees.
For the three months ended Sept. 30, American Express reported net income of $1.36 billion, or $1.25 per share. That compares with net income of $1.25 billion, or $1.09 per share, in the same period last year.
Revenue increased about 6 per cent to $8.3 billion, from about $7.86 billion.
Analysts polled by FactSet were expecting, on average, earnings of $1.22 per share on revenue of $8.23 billion.
Shares in American Express ended regular trading up $1.07 at $76.32. The stock added 23 cents to $76.55 in extended trading.