NEW YORK (Reuters) – American Express Co said on Monday its fourth-quarter earnings tumbled 72 percent due to higher loan losses, lower customer spending and a strengthening U.S. dollar, but results beat expectations as it slashed costs.
The company's shares rose 2.5 percent in after-market trading after falling 5 percent when the market was open. Revenue fell 11 percent, and the company cautioned that 2009 would be a tough year.
"This is one of the most difficult operating environments we have seen in decades. The housing market has continued to deteriorate, unemployment has risen significantly, and retailers have seen some of the biggest declines in many years," said Kenneth Chenault, chief executive of American Express, in a conference call with analysts.
The company offered a guarded forecast for this year. "Card member spending in this environment is likely to remain very soft and we continue to expect past due loans and write-offs to rise from current levels", said Dan Henry, chief financial officer of American Express.