American Express (NYSE: AXP) Chair and Chief Executive Stephen Squeri seems to have been proven right for his careful approach to introducing digital currency services via the payment company’s platform.
In statements shared with Yahoo Finance, Squeri remarked:
“What I’ve said from the beginning is that cryptocurrencies are really an asset class like gold or like silver. Look at Bitcoin – which is a good bellwether – it’s down 50% in two months. How do you call it a currency?”
Squeri noted during the Yahoo Finance All Markets Summit in October of last year that it might be a while before clients might see a crypto-based Amex card.
The digital currency market’s recent crash underscores Squeri’s reserved approach.
Bitcoin (BTC), the flagship cryptocurrency, is trading at just over $37,000 (at the time of writing), down around 20% YTD. The leading virtual currency has lost around 45% of its value from its November 10 all-time high of nearly $69,000.
At one point in January 2022, BTC had been down over 50% from its record highs. And Ethereum (ETH), the second-largest digital currency, is down around 35% YTD.
Squeri pointed out that as he said before, he thinks that “there’s a place for them [crypto-assets], and the underlying technology [they] watch really, really carefully.”
Amex’s steady momentum in what it focuses on doing best — which is primarily credit cards —indicates that the firm does not need to take the risk involved in offering crypto-related products for now at least.
As first reported by Yahoo Finance, American Express saw top-and bottom-line growth within all its business units as the world economy keeps recovering from the COVID-19 crisis.
The firm’s results were reportedly paced by the Global Merchant Service segment. Sales increased around 31% from a year back to about $1.5 billion. Pre-tax profits surged to $508 million from $276 million just a year ago.
And profits at Amex’s Global Commercial Services division recorded a profit of $776 million from $667 million during the past year. Profits in the Global Consumer Services division came in at $1.3 billion.
For this year, Amex forecasts sales surging 8% to 20% from the past year. Earnings are reportedly pegged in a range of $9.25 to $9.65 per share. In the long term, Amex stated that it expects sales growth of around 10%.
Squeri added that the overall outlook for 2022 is solid.