The following is an excerpt from a quarterly earnings announcement by American Express:
American Express Reports Record Quarterly Net Income of $648 Million

Required:
Evaluate and comment on both (a) the earnings quality and (b) the relative performance of American Express in the most recent quarter relative to the same quarter of the prior fiscalyear.

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QUARTER ENDED SEPTEMBER 30 Percentage Inc./(Dec.) $ millions except per share amounts) Net income Net revenues Per share net income (Basic) Average common shares outstanding Return on average equity Net income Net revenues Per share net income (Basic) Average common shares outstanding Return on average equity 20X9 $ 648 $ 574 13.0% $4.879 $4.342 12.4% $1.45 1.27 14.2% 451.6 446.0 23.9% $1,869 $1,611 $14,211 $12,662 $4.18 $3.53 25.3% 16.0% 12.2% 18.4% (2.0%) 447.0 456.2 25.3% 23.9%