American Express Earnings Slip

American Express Co. said its second-quarter earnings fell 3.7%, as results in its international operations were hit by the strong U.S. dollar.

In addition to stepped up competition from its rivals, the New York-based company must contend with the loss of its lucrative 16-year partnership with Costco Wholesale Corp. and a U.S. legal ruling that upends AmEx's long-standing rules that don't permit merchants to steer customers to other forms of payment—a decision American Express has said it plans to appeal.

Overall, American Express reported a profit of $1.47 billion, or $1.42 a share, down from $1.53 billion, or $1.43 a share, a year earlier. The year-earlier period included a gain related to the business-travel operations that previously were part of the company.

Revenue, net of interest expense, decreased 4% to $8.28 billion. However, revenue rose 5% excluding the impact of currency conversions and the business-travel operations.

Analysts polled by Thomson Reuters expected per-share profit of $1.32 and revenue of $8.46 billion.

Write to Tess Stynes at [e-mail]

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