American Express is expected to report higher earnings and revenue than estimated in their second-quarter report, which will publish on Friday (July 19) at 7:30 a.m.
Data should reflect new user growth and higher cardmember spending, according to analysts, as well as an increase in lending and billing. This is on trend with the company’s performance last quarter, which showed that card spending and lending aren’t slowing down anytime soon.
According to analysts, new ventures like the company’s recent acquisition of DER Business Travel will boost user growth. Incorporating DER into the company’s Global Business Travel program will help bolster American Express’ presence in Germany among small and medium-sized businesses.
American Express also announced a deal to acquire reservation platform Resy, to be completed over the summer. Resy operates as both a reservation app for consumers as well as a tech suite that offers booking technology, table management and CRM for restaurant owners. The acquisition, announced on May 15, will add to an expanding array of American Express apps servicing areas of travel, dining and lifestyle.
Still, first-quarter revenue for American Express did not grow as much as predicted, hindered in part by an increase in expenses for customer service improvements. Analysts expect to see a similar struggle in their second-quarter report.
On the flipside, incentives such as reward programs helped to attract new customers. American Express increased the rewards on their Blue Cash Preferred Card on May 2, introducing 6 percent cash back on streaming subscriptions and 3 percent back on transit purchases. The new benefits, which reflect their consumers’ spending habits, are aimed at attracting new millennial cardmembers.
A live audio webcast will follow the earnings release at 8:30 a.m. to discuss the results.