American Express to cut 4,000 jobs this year
22 Jan 2015
American Express said yesterday it planned to cut more than 4,000 jobs this year, about 6 per cent of its total workforce, USA Today reported.
According the New York-based charge-card company, the cuts were part of a company-wide efficiency drive.
The announcement came as American Express reported an 11-per cent rise in fourth-quarter profit.
The cuts would span the company's US and international operations and would take place over the course of the year, according to American Express spokeswoman Marina Norville.
The company would take a $313-million pre-tax charge in the fourth quarter, partly due to the cuts. In a conference call with investors, American Express chief financial officer Jeffrey Campbell said some of the job cuts will be offset by hiring in other parts of the company.
The company's last round of mass cuts came in 2013, when it cut 5,400 jobs, mostly in its travel business.
According to American Express, it earned $1.45 billion, or $1.39 per share, in the three-month period that ended 31 December. That compared with a profit of $1.31 billion, or $1.21 a share, over the same period a year ago. Revenue net of interest expense stood at $9.11 billion, as against $8.55 billion a year ago.
For the full year, the profits of American Express increased 10 per cent to $5.89 billion or $5.56 per share.
Meanwhile, Reuters cited a CNBC report as saying that the 4,000 planned job cuts was a "gross figure" and that the company would hire selectively.
Included in the results is a pre-tax gain of $719 million on the sale of the company's investment in expense-software maker Concur Technologies Inc, which Germany's SAP SE agreed to acquire for around $7.3 billion in September.
American Express shares were down at $87.67 yesterday on the New York Stock Exchange.
