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Travel played a major role in Amex's strong second-quarter earnings

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data: American Express ” Billed businesses increased 30% year-on-year (year-on-year) in the second quarter. Around A presentation of that revenue.It’s a slowdown from A 51% year-on-year surge in the second quarter of 2021This was facilitated by the release of spending after the blockade.

Let’s take a closer look at Amex’s billing business segment.

  • Travel and entertainment (T & E) spending surged 84% year-on-year Compared to last year’s 340% increase, it increased significantly due to post-blockage conditions.
  • Goods and services (G & S) increased 18% year-on-year. G & S spending in the second quarter of 2021 increased 31% thanks to improved consumer finance indicators compared to the previous year.

How to get here: Four factors may have contributed to Amex’s strong second quarter.

  1. Amex’s market position. Despite saying inflation was a “modest contributor” to quarterly volume growth, Amex didn’t notice any significant signs of stress among its customers, CEO Steve Skeri said. Revenue call.. Amex’s strong position in the area of ​​premium and ultra-premium cards suggests that there are a large number of wealthy cardholders who may be less exposed to inflation than low-income consumers.
  2. The tailwind of T & E recovery. Significant increases in travel spending throughout the quarter supported Amex’s billing business. Airline spending increased 148% Each year, restaurants and accommodation increased by 48% and 90% year-on-year, respectively. Corporate travel, which has been slow to recover, also increased in the second quarter. Squeri said T & E spending exceeded pre-pandemic levels for the first time in April.
  3. Acquisition of a young cardholder. Amex has dominated Amex’s customer base and has been committed to acquiring business from Gen Z and Millennials, the fastest growing age groups. These customers — a Total consumption of about $ 3 trillion In 2020 Around YPulse-Accounted 75% of new US consumers platinum and gold cardholders in the second quarter. US consumer platinum and gold card acquisitions hit record highs this quarter.
  4. Investing in digital innovation. Amex has invested more Digital solution.. recently, Alliance Use issuer processor i2c As a result, FinTech and other companies using i2c can boot their cards over the Amex network.It is also empowering Abra Cryptographic card, The first major advance into Amex cryptography. These partnerships and investments may have helped Amex drive more spending on the network.

What’s next? Amex card renewals help take advantage of consumer spending trends.

Amex Has been updated Earlier this month, the Blue Cash Daily Card benefits added new benefits for streaming services, including more cashback benefits for online shopping and gas stations.And that Added Some new T & E perks on the Marriott Bonvoy Business card last week. Renewal of Amex benefits will help increase customer loyalty and acquire new cardholders. Forty-four percent of US consumers cite rewards as the main reason for applying for a new credit card during a pandemic., Around 2022 Lending Tree survey.