American Express saw net write-offs increase again in Q4

American Express Company (NYSE: AXP) is trading up in premarket on Friday even though it reported fourth-quarter earnings that came in slightly shy of Street estimates.

American Express lifts quarterly dividend

The financial services company noted a 40% annualised increase in its provisions for credit losses in the recently concluded quarter to $1.4 billion that suggests a continued increase in net write-offs.

Net reserve build, on the other hand, stood at $400 million versus $492 million a year ago. Stephen Squeri - its chief executive said in a press release today:

American Express stock is being rewarded at writing partially because its management announced a 17% increase in quarterly dividend to 70 cents per share. $AXP is now up close to 40% versus its low in late October.

American Express Q4 earnings snapshot

• Earned $1.9 billion versus the year-ago $1.6 billion
• Per-share earnings also climbed from $2.07 to $2.62
• Consensus was for it to earn $2.64 a share instead
• Provisions for credit losses jumped 40% to $1.4 billion
• Revenue net of interest expense popped a less than expected 11%
• Delinquency rates came in below pre-pandemic levels

American Express is now calling for up to 11% annualised growth in revenue and $12.65 to $13.15 of per-share earnings in Q4. Analysts, in comparison, were at $12.38 a share. CEO Squeri also said today: