Q1 2025 American Express Co Earnings Call Transcript
Key Points
- American Express Co (AXP) reported strong revenue growth of 8% year over year on an FX-adjusted basis, or 9% excluding the leap year impact.
- The company added 3.4 million new cards in the quarter, with Millennials and Gen-Z consumers making up over 60% of new consumer accounts acquired globally.
- Card fee growth was up 20% on an FX-adjusted basis, marking the 27th consecutive quarter of double-digit card fee growth.
- Net interest income increased by 11% on an FX-adjusted basis, growing slightly faster than loans and receivables.
- American Express Co (AXP) maintained a strong credit performance, with delinquency and write-off rates below pre-pandemic levels and flat compared to the prior year.
- There was a sequential slowdown in airline spending growth, although spending on front of cabin tickets remained strong.
- The macroeconomic environment has increased uncertainty, with a peak weighted average unemployment rate of around 5.7% incorporated into the company's guidance.
- Commercial services spend was up only 3% versus last year, consistent with the trends seen in 2024, indicating modest growth in this segment.
- The strengthening of the US dollar continues to be a headwind to reported revenue growth, although less than anticipated earlier in the quarter.
- Rewards expense grew 16% year over year, driven by changes to the URR model and small program changes, which could impact short-term profitability.
Ladies and gentlemen, thank you for standing by. Welcome to the American Express Q1 2025 earnings call. (Operator Instructions) As a reminder, today's call is being recorded. I would now like to turn the conference over to our host, Head of Investor Relations, Mr. Kartik Ramachandran. Thank you. Please go ahead.
Thank you, Dana, and thank you all for joining today's call. As a reminder, before we begin, today's discussion contains forward-looking statements about the company's future business and financial performance. These are based on management's current expectations and are subject to risks and uncertainties.
Factors that could cause actual results to differ materially from these statements are included in today's presentation slides and in our reports on file with the SEC. The discussion today also contains non-GAAP financial measures. The comparable GAAP financial measures are included in this quarter's earnings materials, as well as the earnings materials for the prior
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