American Express to cut 5,400 jobs

American Express Layoffs
Posted at 6:28 PM, Jan 10, 2013
and last updated 2013-01-10 18:28:00-05

LOS ANGELES (AP)-- American Express says 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.

The job cuts will be partly offset by jobs that the company expects to add this year. The company currently has 63,500 employees.

American Express says it will book an after-tax charge of $287 million due to the restructuring. It's also recording $212 million in expenses related to reward points for its cardholders and roughly $95 million in customer reimbursements and other costs. The combined charges will reduce fourth-quarter net income by 46 percent from a year earlier.

The company projects net income of $637 million, or 56 cents per share, compared with net income of $1.2 billion, or $1.01 per share, in the same quarter of 2011.

Excluding one-time items, fourth-quarter 2012 earnings amount to $1.2 billion, or $1.09 per share

Revenue rose 5 percent to $8.1 billion.