Tomahawk, WI 04/21/2014 (Basicsmedia) – With its premium cards held by wealth customers, American Express Company (NYSE:AXP) has no problem returning good profit margins apart from strong volume growth.

Strong Quarterly Figures

American Express Company (NYSE:AXP), which is the third-largest card payment network in the U.S., reported net income of $1.4 billion in 1Q2014, an increase of 7.7% compared to 1Q2013. EPS for 1Q2014 were $1.33, an increase of 16% compared to $1.15 in 1Q2013. Total revenues for 1Q2014 reached $8.2 billion, an increase of 4% compared to 1Q2013. Both spending by card members and income from interests grew while total expenses for the quarter were down with a 4% decline in operating expenses.

Net income for the U.S. Card Services segment in 1Q2014 was $876 million compared to $804 million in 1Q2013. Revenues for this segment were $4.3 billion in 1Q2014, an increase of 5% over 1Q2013.

Net income for the International Card Services segment in 1Q2014 was $159 million representing an 11% decline compared to 1Q2013 with revenues for the segment from 1Q2014 coming in at $1.4 billion, which was a 3% rise compared to 1Q2013.

Net income for the Global Commercial Services segment in 1Q2014 was $184 million, which was a 4% decline compared to 1Q2013. Revenues from the segment in 1Q201 totaled $1.2 billion, an increase of 3% compared to 1Q2013.

Global Network & Merchant Services segment net income in 1Q2014 was $443 million, an increase of 19% compared to $373 million in 1Q2013.  Revenue for the segment in 1Q2014 was $1.4 billion, an increase of 5% over 1Q2013. The ‘Corporate and Other’ segment posted a net loss of $230 million in 1Q2014 compared to a loss of $266 million in 1Q2013.

American Express Serve

American Express Company (NYSE:AXP) has announced today that its full service reloadable prepaid account, known as American Express Serve, will be available for purchase at 4,100 Wal-Mart stores nationwide. These Wal-Mart stores will also become a part of the free cash reloading network of American Express Serve. This takes the number of locations where AmEx Serve customers can add cash to their account for free to 19,500 participating Wal-Mart, CVS and 7-11 locations.

American Express has launched a new documentary-format advertising campaign to promote the Serve accounts.

With its own credit-extending bank and a proprietary card network, American Express gets to profit from both merchant services as well as from cardholders paying interest. With its premium fee-paying customers, American Express is better placed than its peers to withstand the worst imaginable financial downturns. No wonder, it passed the Federal Reserve’s recent stress tests with flying colors.

New Challenges

New challenges to AmEx might come not from the traditional rivals — Visa Inc (NYSE:V) and Mastercard Inc (NYSE:MA) — but from newer rivals such as Google Inc (NASDAQ:GOOG), Amazon.com, Inc. (NASDAQ:AMZN), eBay Inc (NASDAQ:EBAY), Apple Inc. (NASDAQ:AAPL), Facebook Inc (NASDAQ:FB) or even Jack Dorsey-founded Square

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