01—Abstract
Summary
Summary of the 10-K filed February 13, 2020. Cited figures are marked; the original filing is the authoritative source.
American Express Company (AXP) reported solid financial performance for the year ended December 31, 2019.
Total revenues net of interest expense grew by 8% to $43.6 billiona, driven by strong growth in discount revenue and net card fees. The company demonstrated robust customer acquisition and engagement, with proprietary billed business increasing by 7% year-over-year. Net income for the year was $6.8 billion, or $7.99 per diluted share, reflecting disciplined expense management and continued investment in strategic growth initiatives.
AXP maintained strong capital ratios and returned capital to shareholders through dividends and share repurchases totaling $5.9 billionb. The company's diversified revenue streams, strong brand loyalty, and focus on premium customer experiences continue to underpin its competitive position. While facing an evolving regulatory landscape and intense competition, American Express remains focused on its strategic imperatives to drive long-term shareholder value.
02—Key points
Key Highlights
- Total revenues net of interest expense increased by 8% to $43.6 billion in 2019, compared to $40.3 billion in 2018.
- Net income attributable to common shareholders was $6.6 billion, and diluted earnings per common share were $7.99 in 2019.
- Proprietary billed business grew by 7% to $1.07 trillion in 2019, reflecting strong customer spending.
- Net card fees saw a significant increase of 17% year-over-year, driven by growth in premium card portfolios.
- The company returned $5.9 billion in capital to shareholders through dividends ($1.4 billion) and share repurchases ($4.6 billion) in 2019.
- Card Member loans grew by 7% year-over-year, indicating expanded lending relationships.
- American Express achieved virtual parity in U.S. merchant coverage with Visa and Mastercard by year-end 2019.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2019filed February 13, 2020Financial Statements
FY2019 against FY2018
| Line item | FY2019FY2018 | Change |
|---|---|---|
| Revenue | $28.16B$26.61B | +5.8% |
| Interest Expense | $3.46B$2.94B | +17.7% |
| Net Income | $6.76B$6.92B | −2.3% |
| EPS (Basic) | $8.00— | — |
| EPS (Diluted) | $7.99— | — |
| Shares Outstanding (Basic) | 828.00M856.00M | −3.3% |
| Shares Outstanding (Diluted) | 830.00M859.00M | −3.4% |
05—Questions
Frequently Asked Questions
What was American Express's revenue performance in 2019?
American Express reported total revenues net of interest expense of $43.6 billion for the year ended December 31, 2019, an increase of 8% compared to $40.3 billion in 2018. This growth was primarily driven by increases in discount revenue (up 6%) and net card fees (up 17%).
How did the company manage expenses and profitability?
Total expenses increased by 9% to $31.6 billion in 2019. While marketing, business development, rewards, and card member services expenses increased due to investments in partnerships and card member benefits, the company effectively managed its overall expense base. Net income was $6.8 billion, with diluted earnings per share of $7.99, demonstrating strong profitability.
What is the company's strategy for returning capital to shareholders?
In 2019, American Express returned a total of $5.9 billion to shareholders through dividends ($1.4 billion) and share repurchases ($4.6 billion). The company's capital strategy aims to balance investments in growth with capital returns, supported by strong capital ratios and earnings generation.
06—Continue