American Express Co., the 171-year-old American multinational financial services corporation, headquartered in Lower Manhattan, New York City, had topped Wall Street estimates for Q3, 2021 profits, remarking a fourth straight quarter that surpasses analysts’ estimates, as an upscaled use of its credit cards among Gen-Z and millennials, had boosted up overall spending by a substantial margin.
In point of fact, latest upbeat third-quarter earnings’ report from AmEx came against the backdrop of a strong rebound in consumers’ spending following a months-long stagnation, as an acceleration in vaccination drive across the nation alongside an ease in pandemic-led restrictions had spurred up resumptions in social activities while fuelling up US consumers’ spending.
Aside from that, AmEx third-quarter profit growth was largely supported by a growing inflationary pressure which has been forcing the Americans to pay more for basic goods such as household items alongside foods and medicines with US Consumer Prices Index rising as much as 0.4 per cent in September following an upsurge of 0.3 per cent in August.
AmEx profits beat estimates
Meanwhile, addressing to an increase in AmEx Gold and Platinum card usage among a much-younger age cohorts, AmEx CFO (Chief Financial Officer) Jeff Campbell said in a post earnings’ call with the analysts, “It's that younger generation that is just more comfortable, continuing to live their lives as they were pre-pandemic than the older baby boomer generation, which continues to react much more cautiously”.
According to AmEx’s fiscal Q3, 2021 earnings’ report, Gen Z users’ spending soared as much as 48 per cent over July to September quarter compared to the same time a year earlier. Besides, the credit card giant had posted a net income of $1.83 billion or $2.27 a share over Q3, 2021 that ended on September 30, about 70 per cent up on a year-on-year basis, while AmEx’s total revenues surged as much as 25 per cent.
Followed by the release of a jubilant third-quarterly earnings’ report, AmEx shares’ prices had jumped 6.55 per cent to $187.08 apiece on Friday’s Wall Street closure after torrenting over 5.0 per cent in pre-market trading.