Latest news with #Squeri
Yahoo
5 days ago
- Business
- Yahoo
American Express hints at a big upgrade to its Platinum card, designed to lure a lucrative and fast-growing segment of customers
Amex CEO Steve Squeri wants more high-spending Millennials and Gen Z-ers to join his company's upper echelon ranks. And he's starting to give hints of just how exactly he plans to lure more of them to the fold, announcing on June 16 that the company will implement a big upgrade late this summer, or in the early fall to its Platinum card. The company says this will be its biggest investment ever in a card program. 'We'll see two areas of investments,' adds Howard Grosfield, Group President for U.S. Consumer Services. 'We'll double down on all the things our cardmembers love now. And we'll be adding lots of exciting new brands.' Amex has positioned the Platinum card as the most expensive in its class at $695 a year (Chase Sapphire at a comparable level costs $550.) But as Grosfield points out, the Millennials and Gen Z crowd believe they're reaping value well beyond the annual price of entry. The proof: The groups covering the mid-20s to mid-40s age spectrum now comprise 75% of Amex's new accounts acquired on its two premium cards, Platinum and Gold, for 2024, up from 60% in 2019. Gen Z consumer card members grew 40% in Q1 2025 versus Q1 2024, yet the credit record for the two demographics proved better than the industry average. Last quarter alone, Millennial and Gen Z accounted for total 35% U.S. consumer spend. The fast-rising numbers signing on at $695 helped increase net card fee revenue last year by 18%. These youthful troops, says Amex, are proving extremely loyal. The company doesn't disclose quit rates by category, but avows that its all-in retention figure stands at 98%. The strategy dates back to 2021, when three years into the job, Squeri reckoned that the financial services giant's best path to growth lay in attracting a far younger generation of shoppers than the affluent boomers that had traditionally formed his enterprise's—and the industry's—main target. Squeri took aim at Millennials, now 29 to 44, and Gen Z'ers, today's twenty-somethings, and narrowed his sweet-spot for Platinum to the high-income layer boasting excellent credit records. Prior to that refresh, the Platinum benefits focused on travel, chiefly offering deals on the likes of hotel stays, airfares, and access to airport lounges. As the COVID lockdown lifted, Squeri and his team reckoned that the Millennial and Gen Z elite would be craving fresh adventures. So Amex greatly broadened its offerings to cover the breadth of their athletic, treat-seeking lifestyles by adding perks in entertainment, wellness and upscale shopping. Amex also recognized that this cohort comprising everything from lawyers, to investment bankers, to software engineers and rising executives didn't pay like their parents. These were digital natives who often didn't even carry cash, and charged virtually everything on their cards. They were earning more points toward more goodies than any other generations, and getting hooked. Plus, they relished apps that by tapping a few clicks, could bring them a seat in the hottest new restaurants that were always 'booked,' or arrange a tennis lesson on red clay courts during business trip to Paris. The carrot that attracted the younger generation: a new array of perks covering all territories of their leisure lives. They added a digital entertainment benefit award of $240 a year towards subscriptions for such providers as the Wall Street Journal, The New York Times, Disney+, ESPN+ and Hulu. Amex tapped the Millennial and Gen Z yen for Uber by awarding $200 a year for rides on the service, and cardholders garner $300 each towards memberships at Equinox and SoulCycle. As for shopping, Platinum bridges luxe to daily staples, furnishing a $100 credit at Saks Fifth Avenue and Walmart+ membership offering discounts on fuel and in-home pickups for returns. The travel services are trending more more and more to the one-on-one and bespoke: AMEX's crew of 7,000 personal travel consultants can plan your itinerary for holidays in Croatia or book you at a rock concert at Wembley. AMEX also hit an ace by making a major foray into restaurant reservations. Its first move came in 2018, the year Squeri advanced to CEO, via the acquisition of Resy; its app guarantees Platinum holders bookings at super-popular eateries where it would normally take days or weeks to get a table. Today, Resi partners with 20,000 restaurants in thirty countries, and last year bought Tock, another big player that added 7,000 culinary partners, including for the first time, wineries from Napa to the Loire Valley. 'We're the only credit card operator with our own restaurant reservations platform,' says Amex's Grosfield. 'We unlock access to the world's most sought-after tables.' This story was originally featured on Sign in to access your portfolio
Yahoo
06-06-2025
- Business
- Yahoo
Amex leans into B2B payments
This story was originally published on Payments Dive. To receive daily news and insights, subscribe to our free daily Payments Dive newsletter. American Express is nudging corporate clients to use their cards more regularly for business payments, CEO Steve Squeri said in a presentation last week. The push comes as Amex prepares for economic uncertainty. The card giant is looking for ways to increase business-to-business spending by clients who hold corporate or small business cards used for work-related purchases, he said. The New York City-based card company already offers an array of corporate cards that business owners and managers can use for work expenses, but aims to make those cards usable for a wider range of business-related purchases, Squeri said, although he provided few details. The CEO made the comments on May 29 at the Bernstein 41st Annual Strategic Decisions Conference in New York City. "We can do a better job of making more B2B payments viable," he said. "That means on both the card member side and the merchant side." Looking at costs for customers could be one way to achieve that goal, Squeri said. "There is a point where the right pricing decisions drive some more volume there," he said, although he did not elaborate. The acquisition of expense management platform Center was part of the company's push to expand B2B payment volume, Squeri said. 'It [Center] will ultimately become part of the Blueprint platform,' about which he said, 'It's got access to your card account, it's got a cash flow analysis, it's got working capital. We'll integrate travel into that,' he said. 'And so, think about that as a platform going forward for small and midsize businesses.' American Express is also "building out a global, multi-rail B2B network to act as a digital, one-stop shop where any business can buy and sell easily, quickly, and in one place, no matter what kind of payment is required," an Amex spokesperson said in an email. The spokesperson also stressed that the company's foothold in B2B payments goes beyond corporate and business credit cards, and includes partnerships with B2B payment companies such as Boost and Versapay. The card network has taken steps to upgrade its offerings for businesses recently. Last month, for example, American Express gave small business owners access to a virtual credit card that was previously available only to corporate clients. While Squeri did not explicitly link the company's pursuit of B2B payment volume with a possible recession, Amex is turning to business customers as consumer sentiment wavers in the face of economic uncertainty. The card network's cardholders change their spending habits when faced with economic uncertainty, Squeri said."When our cardholders get stressed, they spend a little bit less," Squeri said. Even after President Donald Trump walked back his most aggressive tariffs, economists pointed to a higher-than-average chance of a recession this year. JPMorgan Chase put the odds of the economy slipping into a recession this year at 40% in a report published on May 27, but even if that scenario were avoided, the bank's economists said the U.S. could still see tepid economic growth in the months to come. The bank's prediction was made before the president doubled tariffs on steel and aluminum Wednesday, which could worsen the economic picture by increasing prices in the U.S. Joblessness is something Amex is monitoring closely, more so than the volatile stock market, the company's CEO said. "The thing we really watch for is the unemployment rate," Squeri said. Recommended Reading Amex offers virtual card to small businesses
Yahoo
18-04-2025
- Business
- Yahoo
American Express CEO says his business is in great shape because its wealthy Gen Z clients aren't hurting at all
American Express is in great shape even as the outlook of the global economy remains shaky. CEO Stephen Squeri said total billed business on Amex cards jumped 7.5% year over year and new-card growth was fueled by Gen Z and millennials, who made up the bulk of new customers. The world economy is looking increasingly uncertain, but the CEO of American Express says its wealthy customers are doing just fine. The financial services company on Thursday reported a 7.5% year-over-year increase in total billed business on Amex cards in the first quarter, which helped push the company's revenue up 8% year over year to a better-than-expected $17 billion for the period. Driving the results was solid spending from its wealthy customer base, said CEO Stephen Squeri. 'Through the first 10 to 12 days, it's [spending] as strong as it was last quarter, maybe slightly, slightly stronger, and credit still continues to look really good,' he told Yahoo Finance. Billings on restaurants and lodging stayed strong during the quarter, even as the company saw a slight spending pullback in the airlines category. Squeri also said the company had seen no effect from 'pull forward'—the idea that the delayed effect of purchases from late 2024 could be artificially buoying earnings. Another boon for the company was the 3.4 million new cardholders it added during the quarter, 60% of which were Gen Z and millennials, Squeri said Thursday during the company's first-quarter earnings call. Those younger cardholders spent 14% more in the quarter, while Gen X and boomers spent 5% and 1% more, respectively, CNBC reported. While Amex has traditionally been seen as the elite card of the gray-haired upper class, the brand has increasingly caught the eye of Gen Z and millennials, who have sought out the card for its 'lifestyle' perks. In 2023, 75% of new consumer platinum and consumer gold accounts belonged to these two cohorts, Fortune reported. The company is increasingly catering to younger customers through its restaurant and hotel perks, Squeri said, adding that Gen Z and millennials spent more on eating out than any other customer demographic. Amex has focused on this effort especially with its acquisitions of reservation apps Resy and Tock as well as its relaunch of the Gold Card, Squeri added. 'Gold could have been renamed 'the Restaurant Card' between the rewards accelerator, the Resy credit, and the Global Dining collection,' he said. Despite some economists forecasting a recession on the horizon, Squeri said Amex was expecting strong growth for the rest of the year and reiterated the company's guidance of 8% to 10% revenue growth. This story was originally featured on Sign in to access your portfolio
Yahoo
18-04-2025
- Business
- Yahoo
Rich Still Swiping: Amex Defies Tariffs, Crushes Wall Street Forecasts
American Express (NYSE:AXP) is doing what it does bestleaning on wealthy spenders who aren't flinching, even as tariffs and economic noise rattle the rest of the market. First-quarter earnings per share rose 9% to $3.64, beating Wall Street's expectations, and total billed business hit $387.4 billion, up 6% year-over-year. While that fell slightly short of analyst targets, it wasn't enough to shake Amex's full-year forecast. The company is sticking to its guidance: 8%10% revenue growth and earnings between $15 and $15.50 a share. Warning! GuruFocus has detected 4 Warning Signs with F. CEO Steve Squeri summed it up bluntly: The Amex customer is acting like the Amex customer has acted. Translation? No slowdown. No panic. Even as tariffs and grocery bills climb, the company's high-income cardholderswho pay a premium for rewardsare still spending like it's business as usual. Squeri added that April trends are holding strong, with no signs of hesitation among Amex's core demographic. This cohort may not be recession-proof, but they're certainly recession-resistant. Beyond the numbers, Amex is playing both defense and offense. It set aside $1.2 billion for potential loan lossesless than expectedand made a strategic move to acquire expense management startup Center. Leadership is also shifting, with enterprise services president Anre Williams set to exit later this year. Through it all, the playbook is clear: bet on the big spenders, ride out the noise, and build for long-term profitabilitytariffs or not. This article first appeared on GuruFocus.
Yahoo
28-03-2025
- Business
- Yahoo
3 Reasons American Express Is a Long-Term Buy for 2030 and Beyond
Although growth stocks have a place in many portfolios, even young, risk-tolerant investors should own some long-term value stocks. These stocks that you can count on give you the flexibility to invest some of your other funds in higher-risk, higher-growth potential stocks, since they minimize the overall risk of your entire portfolio. American Express (NYSE: AXP) has been around since 1850 -- that's quite a track record of success. It's a top stock with a differentiated model and long-term growth drivers, and it offers stability for any kind of investor. Here are three reasons to buy it now and hold it for at least five years. American Express has created a brand that targets the affluent consumer, and this customer base is more resilient than the average person. That provides some security for American Express, and it has continued to report healthy, profitable growth despite the inflationary environment. Revenue increased 10% year over year (currency neutral) in 2024, and earnings per share were up 25% to $14.01. CEO Stephen Squeri noted that momentum increased toward the end of the year with a strong holiday season. Consider that even though American Express has only a fraction of competitor Visa's cards (153 million versus more than 2.9 billion for Visa), it takes in close to double Visa's revenue. Today, it's reaching a younger consumer base. It has gone through an image overhaul and is constantly refreshing its cards and rewards program to appeal to the modern cardmember, and younger members account for more of its spending than any other age group. Management said U.S. fee-based consumer premium cards are the fastest-growing segment in its industry, and that it has 25% of those cards, implying a lot of upside potential. Millennial and Gen Z customers are the fastest-growing age group in these cards, and American Express is adding them at a higher rate than the overall industry. American Express also acts as its own bank, providing it with diversified revenue streams and a streamlined operational model. Younger customers are driving growth here too, with millennial and Gen Z members accounting for half of the high-yield savings accounts and a third of total balances. One way American Express stands out is that it charges fees for many of its credit cards. That creates loyalty and a recurring revenue stream, and card fees grow at double-digit rates annually -- 16% in 2024, accounting for nearly 13% of total revenue. About 70% of new card acquisitions were for fee-based cards, and management expects fee growth to stay in the mid- to high teens in 2025. It also has high renewal rates, feeding into this cycle. Squeri pointed out that the U.S. consumer gold card, which is its gold-standard and has a $325 annual fee, is resonating with a younger customer base. This membership base will drive future growth for American Express. American Express pays a growing dividend that yields just over 1% at the current price, or about its average. The dividend is an important reason that Warren Buffett is such a fan, although he loves the whole package. American Express has paid a dividend since 1989,and it's increased more than 200% over the past 10 years. It just announced a 17% increase, from $0.70 to $0.82. That's an excellent indication of how management feels about the company's position and strength. American Express is a stock you can buy today and hold for years, benefiting from its role in the economy and passive income. Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this. On rare occasions, our expert team of analysts issues a 'Double Down' stock recommendation for companies that they think are about to pop. If you're worried you've already missed your chance to invest, now is the best time to buy before it's too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you'd have $312,980!* Apple: if you invested $1,000 when we doubled down in 2008, you'd have $42,421!* Netflix: if you invested $1,000 when we doubled down in 2004, you'd have $537,825!* Right now, we're issuing 'Double Down' alerts for three incredible companies, and there may not be another chance like this anytime soon.*Stock Advisor returns as of March 24, 2025 American Express is an advertising partner of Motley Fool Money. Jennifer Saibil has positions in American Express. The Motley Fool has positions in and recommends Visa. The Motley Fool has a disclosure policy. 3 Reasons American Express Is a Long-Term Buy for 2030 and Beyond was originally published by The Motley Fool
