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American Express reports 76% drop in quarterly profit

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NEW YORK (BridgeNews) — American Express Corp., the travel and financial giant, reported a 76 percent drop in second-quarter earnings after junk-bond investments left its financial advisory unit with a $307 million loss.

The New York-based company surprised Wall Street last week, warning that its profits would be lower than expected and that it plans to lay off up to 5,000 employees. Second-quarter net income fell to $178 million, or 13 cents per share, from the $740 million, or 54 cents, it earned a year earlier.

The results were in line with analysts' estimates, which were lowered from 53 cents after the profit warning.