Summary
American Express Company (AXP) demonstrated a significant recovery in 2010, with income from continuing operations up 90% year-over-year to $4.1 billion, translating to diluted earnings per share of $3.35, a substantial increase from $1.54 in 2009. This performance was driven by robust spending growth across all business segments and improved credit performance, which led to lower write-offs and reduced loss reserves compared to the previous year. Cardmember spending reached record levels by year-end, reflecting a strengthening economic environment. Looking ahead, the company outlined key strategic priorities for 2011, including enhancing merchant value, expanding its customer base to include more diverse demographics, accelerating international growth, and capitalizing on the Enterprise Growth Group's potential. While acknowledging ongoing economic challenges and regulatory uncertainties, including the impact of the CARD Act and Dodd-Frank legislation, American Express remains focused on leveraging its "spend-centric" business model and strong brand to drive long-term growth.
Financial Highlights
42 data points| Revenue | $27.82B |
| Operating Income | $4.06B |
| Interest Expense | $2.42B |
| Net Income | $4.06B |
| EPS (Basic) | $3.37 |
| EPS (Diluted) | $3.35 |
| Shares Outstanding (Basic) | 1.19B |
| Shares Outstanding (Diluted) | 1.20B |
Key Highlights
- 1Total revenues net of interest expense grew 13% to $27.8 billion in 2010.
- 2Income from continuing operations surged by 90% to $4.1 billion in 2010.
- 3Diluted earnings per share (EPS) increased significantly to $3.35 in 2010, up from $1.54 in 2009.
- 4Return on average equity improved dramatically to 27.5% in 2010, compared to 14.6% in 2009.
- 5Cardmember spending volumes reached record levels by the end of 2010, indicating a strong recovery in consumer and business spending.
- 6Improved credit trends contributed to reduced loan and receivable write-offs and lower loss reserve levels compared to 2009.
- 7The company plans to focus on strategic initiatives in 2011, including enhancing merchant value, expanding customer base, accelerating international growth, and developing new fee-based services.