American Express Co. saw spending on its network rise as customers continued to take to the skies despite mass cancellations and long airport waits, prompting the company to raise its full-year revenue forecasts.
The company’s online volume jumped to $394.8 billion, above the $383.3 billion average of analyst estimates compiled by Bloomberg. That helped boost revenue by 31% to a record $13.4 billion, although expenses also increased, partly as a result of customers taking advantage of travel-related benefits.
The jump in spending was “driven by a strong recovery in global travel and entertainment spending, which surpassed pre-pandemic levels for the first time in April,” Chief Executive Officer Steve Squeri said in a statement on Friday. “Goods and services spending, which is the largest category of spending on our network, continued to grow strongly in the quarter, with millennial and Gen Z card spending up 48%.”
The increase in revenue at AmEx comes as US airlines curtail flights this quarter and through the end of the year. Carriers have been hampered by costly flight cancellations and delays due to labor shortages and air traffic congestion, limiting their ability to take full advantage of a surge in demand from customers eager to travel again after being grounded earlier in the Covid-19 pandemic.
AmEx said it now believes revenue will grow by as much as 25% this year, an increase from its previous forecast that revenue would grow by as much as 20%. The company reiterated its guidance for full-year earnings of $9.25 to $9.65 per share.
