DISCOVER: OCT. IS BECOMING NEW DEC. FOR SHOPPING

Discover Financial Services said spending on its cards improved in September, the first increase during the pandemic.

Sales volume climbed 4 percent in September and 7 percent in the first half of October, Discover said in a third-quarter earnings presentation Thursday. Growth in retail sales and grocery purchases have been enough to offset a 49 percent drop in travel spending so far this month.

“A lot of retailers have been conservative. They’re telling their customers it’s a good time to buy early,” with supply shortages looming and possible shopping disruptions from a second COVID wave, Discover CEO Roger Hochschild said. “October is the new December.”

Discover’s net charge-off rate fell 5 basis points to 3 percent in the third quarter and the firm set aside $750 million to cover souring loans, less than analysts expected. That helped increase net income slightly to $771 million.

Discover extended remote work for all employees who are able to do their jobs at home until at least May 31. The firm probably won’t need as much office space over time, Hochschild said, but it’s still planning for a “broad return” to its physical work spaces once the pandemic subsides.

“Our concern is for people early in their careers,” he said. “A lot of your learnings come from informal contacts, whether it’s with peers — you all go out to lunch and talk about what you learned and what’s going on — or a boss who takes 10 minutes after a meeting to call you into their office to tell you about things you could have done better.”