American Express said earnings for the three months ending in March were pegged at 41 cents per shares down some 77.2% from the same period last year. Adjusted earnings, however, came in at $1.98 per share and topped the Street consensus of $1.69 per share. Group revenues, American Express said, were largely flat to last year at $10.3 billion.
The credit card provider also said it has set aside $2.6 billion in loss provisions against missed payments and defaults, a 220% increase from the first quarter of last year. However, the group said it will extend the amount of time merchants can have to address payment disputes and will offer short and long-term financial assistance to card members.
"The first two months of 2020 continued the strong momentum we have delivered over the past two years, but we're now in a different world,' said CEO Stephen. "The deterioration in the economy due to COVID-19 impacts that began in the first quarter and accelerated in April has dramatically impacted our volumes."
"In light of the current environment, we are aggressively reducing costs across the enterprise, while at the same time selectively investing in initiatives that are key to our long-term growth strategy," he added. "We entered this crisis with particularly strong capital and liquidity positions that will enable us to remain financially strong."
American Express shares were marked 0.8% lower in early trading following the earnings release to change hands at $81.75 each, a move that leaves the stock with a year-to-date decline of around 34%.