American Express boosted by rising consumer spending

American Express (AmEx) announced Friday quarterly results that have delighted Wall Street, attributing them to the fact that more consumers are using their cards to make their purchases and pay their bills.

The New York group posted a net profit of $ 1.75 billion (almost as much in francs), up 6.1%, according to a statement

This resulted in adjusted earnings per share, a benchmark in North America, of $ 2.88, higher than the average of $ 2.03 expected by financial analysts.

Sales increased by 8.33% to $ 10.99 billion in the period under review, better than the anticipated 10.94 billion.

In particular, the bank card issuer recorded a 7% increase in spending by its customers, a 19% jump in commissions and a 9% increase in the volume of consumer loans granted.

On Wall Street, the stock, which is one of the thirty stocks in the Dow Jones index, gained 1.74% in electronic trading, investors seem to be reassured about the activity of the group in a context of global economic slowdown.

"I am confident that we can continue to record a high level of revenue growth and a double-digit increase in our adjusted earnings per share," said CEO Steve Squeri, quoted in the statement.

The group nevertheless left unchanged its financial targets for 2019, namely, an adjusted earnings per share of between $ 7.85 and $ 8.35 and a growth of 8 to 10% of sales.

Costs increased by 8.3% and provisions to cover customer defaults by 7%.

AmEx multiplies the offers and promotions (exclusive places of concerts, points giving right to free plane tickets, rooms of hotels at reduced prices in luxury hotels …) to retain current customers and to seduce new ones, against the competition of big banks like JPMorgan Chase, Citigroup, Bank of America and Capital One.

This all-out offensive explodes its spending, which is likely to contract further profit margins because interest rates are falling.

The company nevertheless counts on the high rates it imposes on its customers when they do not honor a repayment deadline.