With the nation hunkering down to slow the spread of Covid-19, American Express Co. said it expects its first-quarter revenues, adjusted for currency fluctuations, to grow only 2% to 4% year-over-year. In contrast, AmEx’s revenues net of interest expense rose 7% to $10.4 billion in 2019’s first quarter.
In an early-morning conference call with analysts, AmEx chairman and chief executive officer Stephen J. Squeri and chief financial officer Jeffrey C. Campbell said travel-and-entertainment spending on AmEx cards has fallen sharply in recent weeks, though they didn’t give numbers. The fall-off is no surprise given the spread of Covid-19, the so-called coronavirus, this winter from China, where it originated, to Europe and now the United States.
AmEx first saw spending weakness in Asia, which generates only 9% of AmEx’s revenues compared with 76% for the United States. “At the beginning of March, we said we were starting to see a bit of softness in T&E volumes outside of Asia,” said Campbell, reviewing data through last Friday. “Since then, we’ve seen that softness accelerate dramatically.”