Economists may be on recession watch, but American Express (AXP) CEO Stephen Scarry said he still doesn’t see spending trends that would suggest a recession is in the cards.
“We’re not seeing signs of a slowdown,” Scarry told Yahoo Finance after the card giant’s fourth-quarter earnings hit the wire.
AmEx reported fourth-quarter sales growth of 23% and 15% in its US consumer services and commercial divisions, respectively. The credit card giant guided for full-year sales growth of 15% to 17%. Earnings are expected to be between $11 and $11.40. Analysts are looking for $10.52.
The company comes to light on revenue and volume vs. Wall Street estimates.
“The only thing we saw in the fourth quarter was small business, some spending reduction, not so much growth in spending, really in digital advertising, so we’re going to see that. I’m not sure if that’s really a function of the moment — whether it’s a function of the economy. Or confusion about where to advertise right now… There’s a lot going on in technology right now. We’re going to see it, but the consumer is really strong, travel bookings are up 50% vs. pre-pandemic. T&E spending is still really strong with the consumer.
Here’s how American Express performed compared to Wall Street estimates:
Shares popped 5% in pre-market trading as investors ignored the earnings miss and locked in an upbeat outlook.
AmEx’s upbeat outlook comes on the back of strong sales trends so far in January at Visa and MasterCard, both of which reported earnings this week.
Squeri’s bullish economic take echoes that of other CEOs this earnings season, including Bank of America’s Brian Moynihan, who described the American consumer as “resilient.” Yahoo Finance Live Interview.
While BofA is in the “mild” recession camp, Moynihan noted that consumers continue to spend at a faster pace to start 2023.
“They’re spending handsomely,” Moynihan added. “The money in their accounts keeps getting tighter.”
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Brian Sozzi A big editor and Anchored in Yahoo Finance. Follow Soji on Twitter @BrianSozzi And then LinkedIn.
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