Updated from 1:50 a.m. EDTAmerican Express ( AXP), the big financial services firm, reported a 15% jump in second quarter profits, fueled by higher spending by holders of its charge card. In the quarter, American Express earned $876 million, or 68 cents a share, compared to $762 million, or 59 cents a share, a year ago. The credit card giant beat the Thomson First Call consensus per-share earnings estimate by a penny. The firm's revenues rose 14% to $7.26 billion, above the consensus estimate of $6.9 billion. The main revenue driver at American Express was its travel related services division, includes both its charge card and travel arrangement businesses. Discount revenue, which includes revenues from the firm's card business, rose 18% to $2.5 billion. Travel commissions and fees rose 26% to $468 million. But the firm's financial advisory business also turned in a solid quarter. Revenues in the financial planning division rose 18% to $1.76 billion. "Our record results this quarter reflected outstanding growth in cardmember spending among consumers, small businesses, corporations and on cards issued on our network by bank partners,'' said American Express Chairman and CEO Kenneth Chenault. While the firm didn't provide any specific earnings guidance for the second-half of the year, Chenault said American Express is "entering the second half of the year in excellent competitive position.'' American Express' earnings are often viewed as a measure of corporate activity, since business travelers are the company's main customers. Shares of American Express were trading higher following the mid-afternoon release of its earnings. The stock rose 78 cents, or $1.6%, to $48.89, providing a boost to the Dow Jones Industrials. Total expenses at American Express rose 14% to $5.9 billion, led by a 33% jump in marketing and promotional expenses for its card and travel businesses. The firm's provision for loan losses was virtually unchanged from a year ago at $1 billion.
The number of American Express Cards in use rose by 7.3% over the past year to 62.3 million cards.