American Express reported that its spending volume was up some 14% in the first quarter — a detail that wasn’t enough to stop the payment company's share price from sliding nearly 4% after it revealed plans to set aside $1.1 billion to cover future loan losses.
Go platinum
That increased spending, which helped contribute to the company’s record-high $14.3 billion revenue, was reportedly fueled by Amex’s $695-a-year Platinum Card. Although not actually made of platinum (stainless steel will have to do), the card has become something of a status symbol, particularly for globetrotters thanks to its travel benefits and access to 1,200 airport lounges.
As the name suggests, the company started as an express delivery service in the 1850s before launching its first financial offerings in the form of the Money Order and Travelers Cheque at the end of the century. Amex moved firmly into the world of finance in 1918 after the government consolidated the express industry during World War 1.
Since then, the company has carved out a unique place as a premium credit card provider. That's a "niche" worth some $52bn in revenue last year thanks to the 135 million Amex cards in circulation, a figure that looks set to grow, as 60% of all new card signups in a recent quarter were Gen Z or Millennials.
