Thu January 10, 2013
American Express To Cut 5,400 Jobs
American Express Co. announced Thursday that it was cutting 5,400 jobs, primarily in its travel business, and take a $287 million restructuring charge associated with those layoffs.
The charge is likely to lower the company's adjusted fourth quarter net income by 46 percent from a year earlier. Excluding the charge, however, the company said its fourth quarter adjusted net income was $1.2 billion, or $1.09 per share.
"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," Chairman and CEO Kenneth Chenault said in a statement.
Here's more from Bloomberg:
The cuts account for about 8.5 percent of AmEx's 63,500- person workforce, a number that will be mitigated as the company refills some jobs, according to the statement. The total number of employees by year-end will drop by 4 percent to 6 percent and American Express expects to hold increases in annual operating expenses to less than 3 percent, the firm said.
The company said the job cuts will take place across "seniority levels, businesses and staff groups."
"The largest reductions will come in the travel businesses, which operate in an industry that is being fundamentally reinvented as a result of the digital revolution," the statement added.