American Express Profits Surge

Consolidated first-quarter revenue, net of interest expense, rises 10%.
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Updated from 4:47 p.m. EDT

American Express

(AXP) - Get Report

said its first-quarter net income jumped 21% from a year earlier as the company got a better handle on its discretionary spending.

Earnings for the quarter totaled $1.1 billion, or 87 cents a share, compared with $873 million and 69 cents a share in the same period a year ago.

On a continuing operations basis, American Express earned 88 cents in the latest quarter, up from 70 cents last year. Consolidated revenue, net of interest expense, rose 10% to $6.67 billion.

Total revenue, before interest costs, grew 14% to $7.63 billion, the credit-card issuer said Thursday. Analysts surveyed by Thomson Financial were looking for a profit of 80 cents and a top line of $7.17 billion.

"Higher revenues, combined with tight controls on discretionary expenses, delivered excellent bottom line results for the quarter," said Kenneth I. Chenault, chairman and chief executive. "Our strong revenue growth reflects the benefit of multiyear investments in our payments business that are generating across-the-board spending growth from consumer, small business and corporate cardmembers."

The company's U.S. card services operation reported first-quarter net income of $644 million, up 22% from a year ago. International card and global commercial services had earnings of $235 million, a 64% increase.

Shares of American Express rose 51 cents to $58.95 in regular trading and added another 4 cents after hours.