(Bloomberg) -- American Express Co. shares fell after the firm trimmed its full-year revenue forecast as it awaits signs of economic improvement that will fuel further consumer spending.
The company predicts revenue for 2024 to increase about 9% compared to a prior prediction of a 9%-11% jump, it said in a presentation reporting third-quarter earnings. While revenue for the period hit another record at $16.6 billion, the haul just missed analyst estimates.
Amex Chief Executive Officer Steve Squeri said on a call with analysts that 10% revenue growth is the “right aspiration” to strive for, and cited the need to see the economy strengthen and for billings to improve to achieve that.
Shares in the firm were down 5.05% at 9:35 a.m. in New York trading. They’re up about 53% this year, compared to a 26% increase in the S&P Financials index.
Still, Amex lifted its full-year earnings per share guidance to $13.75 to $14.05 and reported earnings per share of $3.49 and net income of $2.51 billion in the third quarter, both surpassing analyst estimates.
Consolidated expenses jumped 9% to $12.1 billion as the company spent more on marketing, according to the statement. Amex also posted an increase in provisions for credit losses to $1.4 billion as write offs rose, slightly higher than analysts expected.
The company’s marketing spend is a “big step up this year,” Amex Chief Executive Officer Steve Squeri in an interview. He said the company continues “to be very prudent how we increase that. We look for efficiency in the existing spend. But we are not cutting marketing.”
The company said its marketing expenses increased 19% to $1.47 billion.
“We’ve had ten consecutive quarters of record revenue. We had a really good quarter,” Squeri said. “We beat our own expectations and street too — raising guidance. We see nothing wrong with the fourth quarter.”
New York-based Amex is known for catering to the travel and hospitality desires of higher-spending consumers, and during the quarter, the CEO of Amex-owned Resy said that demand for dining out has continued to stay strong.
Amex has completed 40 product refreshes since the beginning of the year, the company said.
“The strong early results we’re seeing from our product refreshes reinforce my confidence that we’re investing in the right areas to enhance our value propositions and meet the financial and lifestyle needs of our customers,” Squeri said in the statement.
--With assistance from Caroline Hyde.
(Updates with further details from earnings statement, shares from first paragraph.)
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