NEW YORK — Spending at restaurants, shops and entertainment venues has come back in force as vaccines become more common, fueling a revenue surge at American Express during the second quarter.
That momentum picked up as the quarter progressed, particularly spending from younger customers, the company said Friday.
“We saw card member spending accelerate from the prior quarter and exceed pre-pandemic levels in June, with the largest portion of this spending growth coming from Millennial, Gen Z, and small business customers,” Chairman and CEO Stephen Squeri said in a prepared statement.
Revenue, net of interest expense, jumped to $10.24 billion from $7.68 billion last year, and that was stronger than the $9.47 billion that Wall Street was looking for, according to a survey by Zacks Investment Research.
Shares of American Express Co. climbed nearly 4% before the opening bell.
Demand for fee-based cards is getting stronger, Squeri said, and American Express registered 2.4 million new proprietary cards in the quarter.
The New York company earned $2.28 billion, or $2.80 per share, for the three months ended June 30. A year earlier it earned $257 million, or $0.29 per share. The current quarter included $866 million in credit reserve releases.
This easily beat projections of $1.64 from industry analysts.
American Express’ bottom line took a hit in the pandemic, with fewer Americans traveling, dining out or shopping. Spending on corporate and individual charge and credit cards dropped, and those who kept a revolving balance paid off their debts
Earlier this month American Express said that it was increasing the benefits — and the fee — on its flagship Platinum Card. The annual fee is going from $550 to $695.
A portion of this story was generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on AXP at https://www.zacks.com/ap/AXP