American Express lifts revenue outlook after strong quarter, but shares fall

(Sharecast News) - American Express shares dropped in early New York trading on Friday after the payments giant kept its full-year earnings guidance unchanged despite reporting another quarter of double-digit revenue growth and raising its revenue outlook. The company reported second-quarter net income of $3.11bn, up 8% from $2.88bn a year earlier, while diluted earnings per share increased 11% to $4.53 from $4.09.

Total revenues net of interest expense rose 10% year-on-year to a record $19.6bn, driven by higher card member spending, increased card fee income, stronger net interest income and continued customer growth.

Worldwide billed business climbed 9% to $455.8bn, while card member loans increased 10% to $149.4bn and deposits rose 9% to $159.4bn.

American Express added 3m new proprietary cards during the quarter, with millennials and Gen Z accounting for more than 35% of consumer card acquisitions globally. Credit performance also remained resilient, with net write-off and delinquency rates staying below pre-pandemic levels.

Chief executive Stephen Squeri said: "Based on our strong performance, we are raising our full-year revenue growth guidance while maintaining our EPS guidance as we continue to invest behind the significant growth opportunities we see ahead."

Reflecting its strong first-half performance, American Express raised its full-year revenue growth forecast to around 10% from 8-10% previously. However, it maintained its diluted earnings per share guidance at $17.30 to $17.90.

The stock was down 5.6% at $321.81 by 1454 BST.