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'Don't see it in my numbers': American Express CEO doubts recession fears

Brian Sozzi
·Executive Editor
Updated 2 min read
141
In this article:

A big quarter for American Express (AXP) has CEO Stephen Squeri staying optimistic into the back half of the year.

"We're acquiring spending and we see future travel bookings [strong] so I don't see it [a recession] in my numbers at all," Squeri told Yahoo Finance.

"It's really hard for me to get my head around that in quarter three or quarter four we're going to have a big slowdown," Squeri said. "But if we learned anything during the pandemic, you kind of go day-to-day, month-to-month, and so as I sit here today, I do not see [a recession]."

Indeed there were no signs of a recession in Amex's results that hit the wires on Friday. Sales rose 31% from a year ago and spending on cards by Amex members surged by the same amount.

Here is how American Express performed compared to Wall Street estimates:

  • Net Sales: $13.4 billion vs. $12.51 billion

  • Diluted EPS: $2.57 vs. $2.39

Shares rose 5% in pre-market trading.

AmEx also raised its full year sales forecast to 23%-25% growth from a view of 18%-20% previously. Earnings are still expected to fall in a range of $9.25-$9.65 per share.

An American Express credit card is seen on a computer keyboard in this picture illustration taken September 6, 2017. REUTERS/Philippe Wojazer/Illustration
An American Express credit card is seen on a computer keyboard in this picture illustration taken September 6, 2017. REUTERS/Philippe Wojazer/Illustration (Philippe Wojazer / reuters)

The company saw mixed profits within each business segment, as the company cycled strong comparisons to last year's COVID-19 recovery and invested in key areas. AmEx also raised provisions for credit losses by $410 million during the quarter, a move we saw from big banks last month.

Results results were paced by the Global Merchant Service segment, where sales rose 32% from a year ago to $1.6 billion. Pre-tax profits increased to $815 million from $527 million a year ago.

Profits at AmEx's Global Commercial Services segment came in at $817 million from $835 million in 2021. Profits in the Global Consumer Services segment clocked in at $1.4 billion, compared with $1.9 billion a year earlier.

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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