American Express Co., the credit-card issuer grappling with the loss of co-brand partners, posted first-quarter profit that beat estimates as customer spending increased.
Net income slid to $1.43 billion, or $1.45 a share, from $1.53 billion, or $1.48, a year earlier, the New York-based company said Wednesday in a statement. The average estimate of 29 analysts surveyed by Bloomberg was for profit of $1.33 a share. Revenue increased 1.6 percent to $8.09 billion, in line with the estimates, while expenses rose 4.9 percent to $5.47 billion.
Chief Executive Officer Ken Chenault has reassigned senior managers to buoy earnings and consolidate the firm's marketing activities. The company has said it will trim $1 billion in costs by the end of 2017 and focus on lending in the U.S. as competitors cut acceptance costs to win credit-card partnerships with big merchants, a trend that led Amex to part ways last year with its largest co-brand partner, Costco Wholesale Corp.
"First-quarter results were in line with the financial outlook we provided last month," Chenault, 64, said in the statement.
Amex shares fell 12 percent in the first three months of the year, the third-worst performance in the Dow Jones Industrial Average and its fifth-consecutive quarterly decline. The stock has slid 6.5 percent this year, compared with a 4.8 percent increase for Visa Inc., the world's largest payments network, and MasterCard Inc.'s 0.6 percent gain.
Discover Financial Services, the credit-card issuer that's expanded to student lending and unsecured personal loans, posted first-quarter profit Tuesday that beat analysts' estimates as total loans rose 4 percent to $70.3 billion.