American Express on Friday reported its highest ever annual figures for cardholder spending, merchant fee revenue and new card acquisitions in its latest earnings report.
The 2024 increase in demand for its credit card services resulted in a 9% rise in Amex's revenue and a 21% net income increase over 2023, company executives told analysts in an earnings call Friday morning.
The higher spending on Amex cards and new card sign-ups are largely driven by millennials and members of Gen Z, CEO Steve Squeri said during the earnings call. "We're adding highly credit worthy customers in these cohorts,” he said.
American Express reported revenue climbed to $65.95 billion in 2024, up from $60.52 billion in 2023, and net income rose to $10.13 billion in 2024, compared to $8.37 billion in 2023.
Spending by Amex cardholders hit $1.55 trillion in 2024, a 6% increase over the $1.46 trillion in 2023. Net card fee revenue grew to $8.4 billion, a 16% increase from the $7.3 billion in 2023. And new card acquisitions reached 13 million in 2024, a 6.6% increase over the 12.2 million acquisitions in 2023.
Millennials and members of Gen Z accounted for 60% of new card acquisitions in 2023, the company said in its proxy statement last year.
Amex sees younger consumers as an especially lucrative demographic, Squeri said in the earnings call. "Their spending needs will continue to expand as they move forward in their lives and careers," he said.
American Express reported $17.18 billion in total revenue for the most recent quarter, a 9% increase from $15.8 billion in the year ago quarter. The company also reported net income of $2.17 billion in the most recent quarter, a 12% increase from $1.93 billion in the year ago quarter.
The company expects revenue growth between 8% and 10% in 2025 compared to 2024, Squeri said in the call.
"We are encouraged by accelerating billings growth as we believe it will be a key factor for American Express to meet its aspirational target of at least 10% revenue growth," William Blair analysts wrote in a note to investors.
