American Express' first-quarter commercial card-billed
business volume slightly slowed, thanks in part to currency exchange rates but
also in part to slower spending increases from its larger U.S. corporate
accounts, CFO Jeffrey Campbell told analysts during a Thursday earnings call.
American Express Global Commercial Services, the division
that houses corporate cards, totaled $45.3 billion in card-billed volume for
the quarter, down from $45.5 billion year over year. On a constant-currency
basis, however, first-quarter GCS card-billed volume increased 4 percent, on
the heels of an 8 percent constant-currency increase in the fourth quarter of
2014.
"In the corporate card segment, you saw a sequential
slowing from 8 percent in Q4 to 4 percent in Q1," Campbell said of the
constant-currency increases. "That's clearly a much sharper sequential
slowing than you've seen elsewhere."
GCS corporate cards in force declined 3 percent year over
year to 6.9 million, and average spending per corporate card increased about 2
percent to $6,567.
"Corporate spending tends to be a bit more volatile
than other segments because companies have gotten pretty good over the years at
turning on and off their travel spend and other T&E spend in response to
their own business challenges and sense of the economic environment," Campbell
said.
GCS revenue net of interest expense decreased 31 percent year
over year to $827 million; however, last year's figure included revenue from American
Express Global Business Travel, which in July 2014 converted into a joint venture with an investor group led by Certares. GCS income declined 2 percent
to $180 million.
Total American Express revenue net of interest expense
decreased 3 percent year over year to $7.9 billion. Excluding GBT operations, adjusted
revenue increased 5 percent on a foreign exchange-adjusted basis, owing to
higher cardholder spending and higher net interest income, according to an Amex
SEC filing.