American Express Reports Record Revenues and Growth in 2024
2025-01-24
American Express recently held its Q4 2024 Earnings Call, during which key executives, including Steve Squeri, the Chairman and CEO, deliberated on the company's financial achievements and strategies for ensuring sustainable growth. The discussions during the call were accompanied by cautionary remarks regarding the potential risks and uncertainties that could impact the company's future performance.
In 2024, American Express recorded unprecedented revenues of $66 billion, reflecting a 10% increase on an FX-adjusted basis. The company also reported a record net income of $10 billion, translating to earnings per share of $14.01, marking a substantial 25% increase. Furthermore, American Express welcomed 13 million new cards into its portfolio and witnessed growth in its U.S. small and medium-sized enterprise customer segment.
The company's growth trajectory was propelled by its global expansion of the merchant network, which saw millions of new merchant locations added in the year 2024. Looking ahead to 2025, American Express is gearing up to commemorate its 175th year in operation and anticipates revenue growth ranging between 8% to 10%, with an expected EPS of $15 to $15.50. These projections signify a notable 12% to 16% increase over the figures reported in 2024.
American Express's strategy for achieving sustainable growth revolves around targeting new premium customer segments, particularly millennials and Gen Z consumers, as well as small businesses, while concurrently fostering robust international growth. The company intends to channel investments into innovative value propositions, marketing endeavors, and technological advancements to bolster its presence outside the U.S.
The financial performance of American Express in 2024 underscored stable spending patterns, robust loan growth, record net card fees, exceptional credit performance, and substantial operating leverage. Notably, the company witnessed a 15% growth in its international business in Q4, while total loans and core member receivables surged by 9% on an FX-adjusted basis.
During the call, American Express also shed light on its marketing expenditures, operational costs, and initiatives for capital return to shareholders. The company outlined its plans to increase the quarterly dividend by 17% in 2025 and to align the growth of dividends with earnings progression. Additionally, American Express accentuated its commendable credit performance and revenue expansion across diverse sectors.
Looking to the future, American Express acknowledges the potential challenges to revenue growth, with billing trends playing a pivotal role in shaping the company's performance. The company remains steadfast in its commitment to adapting to evolving consumer behaviors, monitoring expenditure patterns, and identifying strategic investment opportunities to sustain growth and fortify its competitive stance in the market.