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American Express makes money even if you do leave home without it. The company is one of the world's largest travel agencies, but it is better known for its charge cards and revolving credit cards. And yes, the company still issues traveler's checks and publishes such magazines as Food & Wine and Travel + Leisure through its American Express Publishing unit. – more... Its travel agency operations have thousands of locations worldwide, and its Travelers Cheque Group is the world's largest issuer of traveler's checks. But the company's charge and credit cards are its bread and butter; American Express has some 97 million cards in circulation worldwide.

Discount fees, or fees paid by merchants when cardmembers use their cards, account for slightly more than half of the company's revenues. American Express has focused on adding merchants and pushing for more widespread acceptance of its cards. The company added more than 1 million merchants in both 2010 and 2011. Previously known primarily as a travel and entertainment card, American Express now does more business on the retail side. The company has also courted businesses that typically accept cash or check payments, including firms in the construction, industrial, and pharmaceutical industries. In addition to card processing and point-of-sale transactions, American Express provides marketing services to its clients.

The economic downturn created big losses for American Express in 2008 and 2009. Earnings fell as the company encountered increased credit losses and write-offs of nonperforming customer accounts. As a result American Express implemented cost-cutting measures including cutting nearly 10% of its work force. American Express also converted to a bank holding company structure, affording it access to bailout funding from the US government. The company's bank subsidiaries Centurion Bank and AEBFSB issue revolving credit cards and consumer charge cards.

American Express' efforts, coupled with a rebounding economy and the general growth in electronic payments, helped the company return to growth in 2010. Net earnings (some $4 billion) were nearly double what they were in 2009. The success was due in part to higher spending by card holders (up some 15%) and improved credit quality. Growth has continued for the same reasons, as well the receipt of the last of an unfair practices settlement payment from Visa and Mastercard, and the company reported net income of some $4.9 billion in 2011.

As earnings improved American Express looked to invest in its capabilities and products. The company is focused on developing new fee-based services and pursuing alternative payment options and digital services. In 2011 American Express bolstered its services by acquiring Germany-based marketing services company Loyalty Partner. It also bought transactions fraud-prevention firm Accertify. Also in 2010 American Express sold its minority stake in American Express Incentive Services, which issues AmEx-branded prepaid cards, to its partner in the venture, Maritz. American Express still views prepaid cards as an area of growth, however.

Another 2010 acquisition was Internet-based payment platform Revolution Money for $300 million. The platform provides online payments and issues reloadable, prepaid cards. Although the company is relatively small, American Express sees big potential and plans to grow Revolution Money internationally. The new payment platform (featuring peer-peer payments, mobile capabilities, and other options) is expected to help support future digital initiatives within American Express. The company has also been experimenting with social media applications allowing it to market deals to customers via Facebook and foursquare.

Despite the progress made in 2010, American Express remained cautious. Slow job growth and increased government regulations in the financial sector have the company looking to remain lean by cutting expenses. It announced another round of layoffs (some 550 jobs) in early 2011.

Warren Buffett's Berkshire Hathaway owns 13% of American Express. – less

Robert Walters Employer Reviews

Payroll Supervisor (Current Employee), londonOctober 29, 2014
Marketing Executive (Current Employee), DublinApril 1, 2014
Manager, Information Technology (Former Employee), Shenton WayMarch 16, 2014
Consultant (Current Employee), GuildfordFebruary 5, 2014
consultant (Former Employee), LondonApril 27, 2013

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