But the company did announce it planned to raise its quarterly dividend and also forecast higher-than-expected profits for 2023, which helped lift the stock in early trading as investors seemed to look past the delinquencies and more at how cardmembers were still strongly spending on their accounts.
The
While AmEx saw a double digit rise in card usage from a year ago — cardmembers spent
The company set aside
AmEx CEO
Over the past several years, AmEx has moved its traditional charge card business model — where a customer must pay off their entire balance each month — to a model closer in line with traditional credit card companies that encourage customers to keep a balance and the company collects interest off of that balance. Worldwide cardmember loans were
While investors have applauded the higher profits from AmEx, the adoption of a business model that encourages customers to keep a balance also exposes the company to losses if the economy were to sour. Investors did ask executives if the recent white collar layoffs are impacting their business at all, and executives said it did not appear so and that the rise in credit losses was mostly a normalization from the pandemic, when customers paid off their credit cards.
Noting the growth in cardmember spending and an expectation that delinquencies will level off this year, AmEx did forecast a full-year profit between
In morning trading, shares of
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