American Express Company (NYSE: AXP) released its second quarter 2016 financial report on July 21，Net profit 2 billion US dollars，An increase of 37% from US$1.5 billion in 188bet app download the same period last year。Diluted earnings per share (EPS) increased 48%，1 from the same period last year.$42 rises to 2.$10，Higher than previous market expectations，Benefit from outstanding performance，The stock rose sharply by 1 as of the close on the 22nd.39%。

Second quarter net income includes $1.1 billion (after tax 6 from the previously announced sale of the co-branded Costco U.S. credit card portfolio business.$7.7 billion) and the company’s restructuring savings from cutting fixed costs2.$3.2 billion (after tax 1.USD 5.1 billion)。

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Revenue after interest expense is $8.2 billion，Down 1% year-on-year；

Net profit is US$2 billion, a year-on-year increase of 37%;

Diluted earnings per share (EPS) is $2.10;

The average return on equity (ROE) is 26.4%，Down 6% year-on-year；(Although down 6%，But an ROE of more than 20% is still excellent。）

From Q3 2016 to Q2 2017，Company plans to repurchase $3.3 billion worth of common stock。

Second quarter consolidated total revenue after interest expense was $8.2 billion，Decreased 1% from US$8.3 billion in 188bet app download the same period last year。After deducting the exchange rate impact of the stronger US dollar on international business，Adjusted total revenue increased 1%，The main reason is that the net profit from credit card fees and the net profit from interest increased。These gains partially offset losses caused by 188bet app lower revenue from Costco-related businesses and lower average discount rates。

Consolidated loss reserve for the second quarter is 4.USD 6.4 billion，4 compared with the same period last year.USD 6.7 billion, down 1%。Credit cards continue to maintain strong development momentum this quarter。Last quarter’s earnings report listed $57 million in credit card costs related to the co-branded loan portfolio as “for sale (HFS)”；Credit card costs related to that portion of the portfolio during the quarter are included under other operating expenses。

Second quarter consolidated operating expenses of $4.8 billion，Decreased 15% from US$5.6 billion in 188bet app download the same period last year。The decrease in expenses was primarily due to the sale of the loan portfolio，This part of the income has been listed under the expense reduction item。Expenses for this quarter mainly include restructuring charges mentioned in the previous quarter and high-level investments to promote growth。Operating expenses decreased by 31% compared with the same period last year。Without considering portfolio sale proceeds and restructuring expenses，Adjusted operating expenses were basically the same as the same period last year。

The effective tax rate in the second quarter is 33%，Decreased 1% from 34% in 188bet app download the same period last year。

The company’s average return on equity (ROE) in the second quarter was 26.4%，28 compared to last year.1% down 6%。

Board of Directors and CEO Financial Report Summary

American Express Chairman and CEO Kenneth Chenault said: "This quarter's operating expenses are very convincing，Consistent with the financial outlook announced by the company at the beginning of the year。Our measures to accelerate growth have yielded good results: 3 million new exclusive card customers worldwide、Global network business growth、Continuing to meet the needs of credit card members while expanding retailer coverage and maintaining high-quality credit cards。” 

"Second Quarter Period，The company once again increases investment in marketing and technology to grow its business。Meanwhile，The company’s operating expenses continue to be effectively managed，We continue to move toward our goal of achieving $1 billion in cost reductions by the end of 2017。”

"So 188bet Online Sports Betting and Casino far this year，The total amount of funds we have returned to shareholders has reached a record，Repurchased $1.7 billion worth of shares in Q2，A total of US$2.8 billion worth of shares have been repurchased so far this year。After completing the Federal Reserve’s annual stress test，We now plan to increase our quarterly dividend per share from 10 cents to 32 cents，Another $3.3 billion worth of shares will be repurchased over the next four quarters。” 

"As expected，Earnings for the quarter include the sale of the co-branded loan portfolio business and reductions in restructuring charges as a result of reprogramming fixed costs。In addition，We will also continue to pay attention to the impact of lower retailer discount rates and the stronger U.S. dollar on the company's international business。”

“Worldwide toll business increased by 3% compared to last year，Excluding the impact of foreign exchange rates involved in Costco’s business，The adjusted toll business volume increased by 8% compared with 188bet app download the same period last year。Total borrowings decreased by 13%，Excluding the loan and foreign exchange factors involved in the 'For Sale' investment portfolio，Adjusted borrowings up 13%。Adjusted figures benefit from increased use of other American Express credit cards among former Costco co-branded credit card members。”

“We are very confident with the progress we have made so far this year，The company plans to continue making high-level investments throughout the remainder of 2016，Seize the opportunity in the fiercely competitive market。Although spending levels will increase further，But we expect that the 2016 results will reach the upper limit of the goals set at the beginning of the year。As for 2017，Our expectations remain unchanged，The company will continue to focus on accelerating revenue growth、Replan fixed costs and optimize investment business。”

Business data of each segment in the second quarter 

1. US Consumer Services Business

Financial report display，U.S. consumer services business second quarter net profit of $1.1 billion，6 compared with the same period last year.1.3 billion, an increase of 74%。

Total revenue after interest expense is $3.2 billion，Decreased 3% from US$3.3 billion in 188bet app download the same period last year。The decrease in revenue was mainly due to the decrease in Costco-related business revenue and the increase in cash discounts and rebates a year ago。 

The total loss reserve is 2.US$3.7 billion，2 compared with the same period last year.$4.3 billion down 2%。Credit cards continue to maintain strong development momentum this quarter。Some credit card costs during the quarter related to the co-branded loan portfolio business that was listed as “for sale” have been included under other operating expenses。

Total cost $1.3 billion，Down 40% from US$2.1 billion in 188bet app download the same period last year。The decrease in expenses was primarily due to a portion of the proceeds from the sale of the loan portfolio，This part of the income has been listed under the expense reduction item，Proceeds were used in part to support high levels of investment in growth and the company's restructuring to reduce fixed costs as mentioned last quarter。

The effective tax rate for this part of the business is 37%，Decreased 2% from 35% in 188bet app download the same period last year。

2. International credit card and network services business 

Financial report display，International credit card and network services business second quarter net profit was 2.USD 2.8 billion，1 compared to last year.US$9.3 billion, an increase of 18%。

Total revenue after interest expense is $1.4 billion，An increase of 6% compared with US$1.3 billion in the same period last year (revenue increased by 11% after deducting exchange rate effects)，The increase in revenue is mainly due to the increase in revenue caused by the upgrade of bank partners and the increase in credit card transactions。

Total loss reserves are US$78 million，An increase of 3% compared with US$76 million in 188bet app download the same period last year。

Total cost $1.1 billion，An increase of 4% compared with US$1 billion in the same period last year (excluding exchange rate effects，Expenses increased by 7%)。The increase in expenses was mainly due to increased investments to promote growth，The other part is the restructuring expenses mentioned in the last quarter。 

The effective tax rate for this part of the business is 17%，Decreased 2% from 19% last year。 

3. Global business services business

Financial report display，Global business services business second quarter net profit was 5.USD 7.6 billion，5 compared with the same period last year.USD 5 billion, growth 5%。

Total revenue after interest expense is $2.5 billion，Same as the same period last year，remain unchanged。

The total loss reserve is 1.US$3.9 billion，1 compared with the same 188bet app download period last year.US6 billion, an increase of 2%。 <.6 billion, an increase of 2%。 

Total cost $1.4 billion，Decreased 4% from US$1.5 billion in the same period last year，The decrease in expenses was primarily due to the sale of the loan portfolio，This part of the income has been listed under the expense reduction item。Proceeds were used in part to support high levels of investment in growth and the company's restructuring to reduce fixed costs as mentioned in the last quarter。

The effective tax rate for this part of the business is 37%，2% increase from last year’s 35%。 

4. Global Retailer Services Business 

Financial report display，Global Retail Services Business second quarter net profit was 3.US$7.3 billion，3 compared with the same period last year.US$6.9 billion, up 1%。

Total revenue after interest expense $1.1 billion，Decreased 3% from US$1.2 billion in 188bet app download the same period last year。The lower discount rate in this quarter offset the benefits brought by the high spending of credit card members。 

Total cost is 5.US$4.7 billion，5 compared with the same period last year.USD 8.6 billion, down 7%，largely due to the implementation of the OptBlue program，The program expands the company’s retailer reach，But no more benefits for retailers and buyers。

The effective tax rate for this part of the business is 38%，Slightly increased from 37% last year。

In addition，Second quarter financial report display，Enterprise and other business net loss 2.US$2.9 billion，And the net loss in the same period last year was 2.US$5.2 billion。

About American Express

American Express Company is the largest travel service in the world、Comprehensive Finance、Global company in financial investment and information processing，On credit card、Traveler’s Check、Travel、Leading position in financial planning and international banking，Is the only service company among the thirty companies in the Dow Jones Industrial Index that reflects the U.S. economy。

In the latest 2016 Fortune Global 500 ranking，American Express ranks 302nd，Total revenue in 2015 344.USD 400 million，Net profit 51.USD 600 million。

American Express operates mainly through its three major branches: American Express Travel Related Services，American Express Financial Advisors and American Express Bank。

*Author of this article: Li Haiqiang (personal WeChat: lhq434849653)，Zhihui Tourism Analyst，Welcome to break the news、Welcome to communicate！