Skip to main content
Canada’s most-awarded newsroom for a reason
Enjoy unlimited digital access
$1.99
per week
for 24 weeks
Canada’s most-awarded newsroom for a reason
$1.99
per week
for 24 weeks
// //

American Express Co (AXP-N) said on Tuesday it expects an uptick in holiday travel this summer, but not business travel, as it seeks to recover from a year which dented airline traffic and hotel bookings, knocking 15% off its bottom line.

The New York-based company still beat Wall Street estimates for profit as it lowered credit loss reserves and benefited from higher online spending by consumers stuck at home.

.”..As we get into this summer season, this June, July, August and September, you will see a rush for people to travel, especially air travel,” CEO Stephen Squeri said on a post-earnings conference call.

Story continues below advertisement

AmEx forecast a 9% to 10% jump in overall 2021 revenue, with travel and expenditure (T&E) spending by consumers recovering to around 70% of fourth-quarter 2019 levels by the final quarter of 2021. That indicates full-year revenue of $39.7 billion on the upper end of the range, marginally below consensus estimates of $39.92 billion.

The bullish outlook for travel, however, failed to lift shares, which fell 3% in late morning trade after AmEx’s total revenue, net of interest expense, dropped 17.1% to $36.09 billion.

A rebound in corporate travel will take longer, AmEx warned, with companies, particularly large ones, limiting their T&E spending for some time. T&E spending on AmEx’s cards declined 65% in the final quarter of 2020.

The company does not expect a full-blown recovery before 2022, but is focused on achieving the EPS expectations it had for 2020 in 2022, Squeri said.

AmEx also lowered some reserves it had set aside for credit losses and posted a gain of $111 million from consolidated provisions, compared with credit loss provisions of $1.02 billion last year.

Net income fell to $1.44 billion, or $1.76 per share, for the quarter ended Dec. 31, compared with estimates for a profit of $1.31 per share, according to IBES data from Refinitiv.

Be smart with your money. Get the latest investing insights delivered right to your inbox three times a week, with the Globe Investor newsletter. Sign up today.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow topics related to this article:

View more suggestions in Following Read more about following topics and authors
Report an error
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

UPDATED: Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies