American Express Company

Ladies and gentlemen, thank you for standing by. Welcome to the American Express Q1 2025 earnings call. At this time all participants are on a listen only mode. Later we will conduct a question and answer session. If you wish to ask a question, please press star then one on your touch tone phone. You will hear a tone indicating that you have been placed in queue. You may remove yourself from the queue at any time by pressing star then two. If you are using a speakerphone, please pick up the handset before pressing the numbers. Should you require assistance during the call, please press star, then zero. 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.

Kartik Ramachandran Thank you, Donna, 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 periods we discussed. All of these are posted on our website at ir.americanexpress.com. We'll begin today with Steve Squeary, Chairman and CEO, who will start with some remarks about the company's progress and results. And then Christophe Lecayac, Chief Financial Officer, will provide a more detailed review of our financial performance. After that, we'll move to a Q&A session on the results with both Steve and Christoph. With that, let me turn it over to Steve.

Thanks, Karthik. Good morning, and thanks for joining us. We had another strong quarter to start the year. We delivered revenues of $17 billion, up 8% year-over-year on an FX-adjusted basis, or 9% excluding the leap year impact. And we generated net income of $2.6 billion, or $3.64 per share. During the first quarter, our premium customer base continued to spend at healthy levels. Total card member spending grew 6% in the quarter, or 7% excluding the impact of leap year, with spending on goods and services continuing to grow at a faster rate than in 2024. In T&E, while we saw a sequential slowdown in airline billings growth, billings in restaurants and lodging remained strong in the quarter, and overall T&E growth was in line with the steady levels we saw through most of last year. We also continue to grow our customer base, adding 3.4 million new cards in the quarter. As in past quarters, millennial and Gen Z consumers made up over 60% of new consumer accounts acquired globally in Q1. In addition, card fee growth was up 20% on an FX adjusted basis. Retention continued to be high and our credit performance remained excellent. While it's still very early in the second quarter, Through the first week and a half in April, overall spending levels have remained consistent with what we saw in the first quarter in both goods and services and T&E and across all customer segments. Based on the steady spend and credit trends we've seen to date, we're maintaining our full year revenue growth guidance of 8% to 10% and EPS of $15 to $15.50. While we recognize that uncertainty in the environment has increased, the guidance incorporates the changes that we see in the macroeconomic outlook as of today. As we think about the near future, we have a resilient and differentiated business model that positions us well to navigate a range of economic environments. First and foremost, we have a global premium customer base at scale. In fact, As our customer base has grown over the past several years, it has gotten even more premium. Our card members have high incomes, are loyal, high spending, and have excellent credit profiles. And as you know, we underwrite all our card members through the credit cycle. Another key differentiator of our model is our mix of revenues. Well, the combination of spend and fees accounting of 75% of our overall revenue base, which makes us less reliant on lending revenues and less sensitive to credit cycles compared to our competitors. Also, we have significant expense leverage and flexibility that has grown as our scale has increased over the past several years, enabling us to effectively control our costs while continuing to invest for the long term. In addition to the natural hedges and our customer engagement expenses, we have several levers across our marketing and operating expense lines, enabling us to quickly pivot if the environment changes. Looking ahead, we'll need to see how things play out in the coming months. That said, we are operating from a position of strength, and we have a set of principles that guide us. Our fundamental objective, as it is with everything we do, is to manage the company for the long-term growth for our shareholders. As we do so, we are focused on four core principles. Above all, we'll back our customers through ongoing enhancements to our products and services, as well as providing support for those who may need it. We'll also back our colleagues so they continue to focus on innovating for our customers and providing a world-class experience that is core to our brand. We'll exercise disciplined expense management using the various levers in our business model to maintain financial flexibility. And we'll continue to invest strategically for the long term in areas that strengthen our foundational capabilities, such as technology, control management, and customer acquisition, as well as capitalizing on opportunities that emerge for expanding our membership model with new and enhanced products, services, and experiences. As we move ahead, we are committed to following these principles and leveraging the advantages of our business model, which makes me confident that we are well positioned for continued growth over the long term. I'll now turn it over to Christoph to provide more color on our first quarter results, and then we'll answer your questions.