Good morning,
During American Express’ Q4 2021 earnings call Tuesday, CFO Jeff Campbell made clear that a crypto-linked card isn’t in the near future.
An analyst on the call asked about the global giant’s tech stack and if blockchain and crypto are on the company’s radar as potential disruptors to payment rails.
“We watch cryptocurrencies … we think about the spectrum of digital currencies,” Campbell said. “We think about crypto … stable coins … [and] Central Bank digital currency. At this particular point in time, we view cryptocurrency more as an asset class. I mean, you’ve just seen Bitcoin go from $68,000 a coin to $34,000 a coin.” He continued, “We’ve got investments in blockchain companies to constantly look at [it] and figure out if there are use cases for us.”
When it comes to NFTs, “we’re partnering with, obviously, the NBA and Top Shot,” he said. “We’ll look at ways to get involved. But as I’ve said, we’re probably not going to offer a crypto card. We keep our eye on cryptocurrency in case it becomes more stable. But right now, I don’t see it as an immediate or medium-term threat to our business.”
American Express CEO Stephen Squeri shares Campbell’s sentiment. But he also said that crypto isn’t exactly a currency. “What I’ve said from the beginning is that cryptocurrencies are really an asset class like gold or like silver,” Squeri told Yahoo Finance. “Look at Bitcoin—which is a good bellwether—it’s down 50% in two months. How do you call it a currency?”
Yes, Bitcoin has taken a plunge lately. Cryptocurrencies are down $1.4 trillion since November, Fortune reported. And it’s no secret that most CFOs haven’t warmed up to crypto due to its volatility and complexities. It’s “a hard thing” to use crypto in the payment space, Campbell said on the call. In regards to Q4, American Express earned net income of $1.7 billion, or $2.18 per share, compared with net income of $1.4 billion, or $1.76 per share, a year ago. In the quarter, customers spent $368.1 billion on their cards in comparison to $285.9 billion spent in 2020.
However, the company’s total expenses were $946 million, up 15% from $823 million a year ago, according to the report. This reflects higher marketing investments and operating expenses, primarily driven by increased compensation, the company said. In the war for talent, compensation costs also rose for big banks like Goldman Sachs and Bank of America.
Campbell believes the investment American Express has made in talent is worth it. “Our experience through this period has reinforced our conviction that investing strategically in our customers brand and talent is absolutely critical driving high levels of growth,” he said on the call. “We’ve seen that play out in the results we delivered throughout 2021.”
See you tomorrow.
Sheryl Estrada
sheryl.estrada@fortune.com
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Join us for our CFO Collaborative event, Finance as a Driver of Transformation, in partnership with Workday, on Wednesday, January 26, from 3-4 p.m. ET. The program will feature two interviews—one with Jeff Jones, president and CEO, H&R Block, and another with Amy Feirn, Deputy CEO, partnerships and offerings, Deloitte Consulting LLP—as well as small group discussions. We’ll explore how to deal with macroeconomic shifts from digital transformation and record M&As to the war for talent and increased focus on ESG demands from stakeholders. We’ll also delve into how finance is key to support your organization’s transformation across the board. CFOs, you can register here.
Big deal
Mind, Body, and Wallet, Guardian Life Insurance Company of America's workplace benefits study released Jan. 25 found workers’ well-being varied greatly by industry. Employees in the financial services (55%) and construction (50%) industries reported the highest states of mental health. In comparison, just 31% of health care workers reported excellent or very good mental health. "This could be due to hospital workers struggling with major influxes of COVID-19 patients, or to private practices experiencing full closures or a move to a telehealth-only practice," the report stated. About 79% of companies said improving the health and wellness of their workers is important. Most companies believe they are doing a good job. Meanwhile most employees disagree, according to Guardian. The findings are based on a survey of 2,000 employee benefits decision-makers and a survey of 2,000 employees age 22 or older.
Going deeper
The Antidote to Manager Burnout, a report by Gallup, explores how manager burnout can affect the entire team. "Managers are responsible for the burnout antidotes of engagement and wellbeing—so when they burn out, individual contributors can't hope for much help," according to the report. Among Gallup's suggestions are identifying the challenges managers face and then focusing on strengths "to help managers lean into what they do best."
Leaderboard
Barry Broadus was named CFO at ICF (Nasdaq:ICFI), a global consulting and digital services provider, effective Feb. 28. Broadus will replace Bettina Garcia Welsh, who will be leaving ICF to pursue new opportunities. Welsh has agreed to stay on at ICF as an advisor through early April. Broadus has more than 30 years of financial management experience. Most recently, he was the CFO of Dovel Technologies. Previously, Broadus served as CFO of SRI International, Constellis, and Alion Science and Technology.
Michael Dear was named CFO at Universal Engineering Sciences (UES), a privately-held engineering and consulting company. Dear is a finance leader with more than 30 years of global expertise in the engineering services and construction industry. Dear most recently served as CFO for PLH Group. Prior to that, he worked at John Wood Group serving as CFO for Wood Group Mustang based in Houston. He previously worked as group financial controller after initially joining as CFO of their industrial turbines division.
Overheard
"One of the things I learned in the last four years at the firm is I’m actually an entrepreneur. It was time to go out on my own. It’s pretty much that simple."
—Katie Haun on why she left the venture capital firm Andreessen Horowitz, as told to Fortune.
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