There was a significant rise in net profit in its third quarter for US integrated payments company American Express Co compared to the same period of the previous year, the company reported on Friday.
American Express' net profit for the first quarter grew 35% from last year, driven by revenue growth across all its operating segments, partially offset by higher provisions for credit losses.
Both earnings per share quarterly revenues topped analysts' estimates.
The company also reaffirmed its earnings and revenue guidance for fiscal 2024.
In Friday's regular trading session, American Express is currently trading on the NYSE at $225.89, up 8.39 or 3.86%.
"We have started 2024 off strong, with our first-quarter results reflecting the positive trends we have seen in our business the last several years," said Stephen Squeri, chairman and chief executive.
For the first quarter, net income attributable to common shareholders increased to $2.41 billion or $3.33 per share from $1.79 billion or $2.40 per share in the prior-year quarter.
Consolidated total revenues, net of interest expense, grew 11% to $15.8 billion from $14.28 billion in the same quarter last year, primarily driven by higher net interest income and increased card member spending.
Net interest income increased 26% to $3.77 billion and non-interest income was up 6% to $12.03 billion from last year.
Consolidated provisions for credit losses were $1.3 billion, compared with $1.1 million a year ago, reflecting higher net write-offs, partially offset by a lower net reserve build.
US consumer services revenues grew 14% to $7.50 billion, commercial services revenues were up 8% to $3.79 billion, International card services revenues increased 8% to $2.71 billion, and global merchant and network services revenues improved 7% to $1.87 billion from last year.
Overall card member spending grew 7% on an FX-adjusted basis, with spending by US consumer card members up 8% from a year earlier and spending in international card services segment increasing 13% on an FX-adjusted basis.
Consolidated expenses were $11.4 billion, up 3% from $11.1 billion a year ago, primarily reflecting higher customer engagement costs, driven by higher card member spending, higher marketing investments and higher usage of travel-related benefits.
Looking ahead to fiscal 2024, the company continues to project earnings in the range of $12.65 to $13.15 per share on revenue growth of 9 to 11%, based on its performance to date.
The Street is currently looking for earnings of $12.84 per share on revenues growth of 9.5% to $66.25 billion for the year.