American Express is making more money than ever.
April 19, 2012– American Express announced on Wednesday that 12% more was charged by its cardholders in the first quarter of 2012 than in the same quarter a year ago. The company also said its past due accounts remained at record lows.
Those figures helped the company to beat Wall Street estimates for earnings for the first quarter. It also added to recent evidence that well-off people are increasing their spending.
The average household that has an American Express card is earning annual income of $97,000. That compares to the average income of $71,000 earned by all credit card customer overall.
American Express announced earnings of $1.25 billion worth $1.07 per share, which was a 7% increase from one year ago. Wall Street forecasts had predicted earnings to be $1.01 per share. Revenue for the company was $7.6 billion, an 8% jump and that beat expectations as well.
Sales at luxury stores throughout the U.S. were increasing more rapidly than in stores in general and American Express said profits for the company in the U.S. jumped by 35% to over $752 million.
American Express is different from both MasterCard and Visa. AmEx issues its own cards, while MasterCard and Visa only are processors of transactions. When more charges are made on an AmEx card, the company earns more fees.