American Express Co. to cut 5,400 jobs

American Express Co. to cut 5,400 jobs

New York City : NY : USA | Jan 10, 2013 at 11:34 PM PST
Views: Pending

American Express Co. has announced to cut around 5,400 jobs in a move to control rising costs and restructure its business. The decision was taken after a majority of its customers moved to the internet for reservations of travel plans. Most of the jobs will be cut from its travel business, the company said on Thursday.

American Express said that its fourth-quarter net income will be around 56 cents per share, showing signs for reorganization. The job cuts will be partially counterbalanced by new jobs that the company aims to add this year.

"Against the backdrop of an uneven economic recovery, these restructuring initiatives are designed to make American Express more nimble, more efficient and more effective in using our resources to drive growth," American Express CEO Kenneth Chenault said in a news release, according to CBS News. "For the next two years, our aim is to hold annual operating expense increases to less than 3 percent."

The company said the jobs cut will apply across all levels and divisions in its operations across the world, but will chiefly target positions that do not directly bring business. American Express said employment levels will end up between 4 and 6 percent lesser in 2013, as compared to 2012.

The company’s revenue increased 5 % to $8.1 billion, which was slightly more than analysts’ expectation of $8.01 billion.

According to reports, the credit card company plans to report full results next Thursday.

On the whole, American Express has done an excellent business following the economic recession, as upper segment customers have spent liberally. That’s because its Amex cardholders are around a third wealthier than other credit cardholders.

In spite of those achievements, the company wants to employ state-of-the-art technologies in order to become more competent, sustain its efficiency and put more money into business growth opportunities.

Reports suggest that the company also plans to renovate its cardholder servicing and recovery functions to concentrate more on internet and mobile, instead of telephone and physical mail.

“The overall restructuring program will put us in a better position as we seek to deliver strong results for shareholders and to maintain marketing and promotion investments at about 9 percent of revenues,” said CEO Kenneth Chenault, according to the Washington Post.

Kamran Ahmed is based in Seattle, Washington, United States of America, and is an Anchor on Allvoices.
Report Credibility
  • Clear
  • Share:
  • Share
  • Clear
  • Clear
  • Clear
  • Clear

News Stories

  • American Express to cut 5,400 jobs

      Seattle Post Intelligencer
    American Express Co. said Thursday that it will slash roughly 5,400 jobs, mainly in its travel business, as it seeks to cut costs and transform its operations as more of its customers shift to online portals for booking travel plans and other needs.
  • Amex to cut 5,400 jobs; take $287mn restructuring charge

      India Abroad
    F rom Credit card major American Express Co has announced it is cutting 5,400 jobs, primarily in the travel business, and take a $287 million restructuring charge associated with those layoffs. The charge is likely to lower the company's adjusted...
  • American Express profit falls on costs tied to 5,400 job cuts at lender

      Suburban Trends
    The Record American Express Co., the biggest U.S. credit-card issuer by purchases, said fourth-quarter net income dropped about 47 percent on costs including expenses tied to a planned 5,400 job cuts. The lender will take $594 million in after-tax...
  • American Express to slash 5,400 jobs

    American Express ( AXP ) says it will cut an estimated 5,400 jobs, mainly in its travel business, and book a $287 million charge. As a result, the credit card company projects that it will report a decline in adjusted net income from a year ago. The...
  • American Express to cut 5,400 jobs, take charges in Q4

      The Economic Times
    American Express Co said it would cut about 5,400 jobs, and take about $600 million in after-tax charges in the fourth quarter, which will halve its net income for the period. The credit card company said it would employ 4 to 6 per cent fewer people...
  • American Express cuts 5,400 jobs

    The credit card provider said it took almost $600m (£370m) in after-tax charges in the fourth quarter of 2012. The company said that these charges would halve its net profit for the quarter from $1.2bn to $637m. It said the majority of the job losses...

More From Allvoices

Report Your News Got a similar story?
Add it to the network!

Or add related content to this report

Use of this site is governed by our Terms of Use Agreement and Privacy Policy.

© Allvoices, Inc. 2008-2014. All rights reserved. Powered by PulsePoint.