Large corporate business is “crawling its way back” as companies work to get employees back to the office, according to Stephen Squeri, CEO of American Express, speaking on a second quarter earnings call.
He said the company is seeing “a little bit less of one-stop trips, that quick job to London to meet with one client or that quick sort of run across the country to have an internal meeting.” That kind of travel, said Squeri, will continue to come back. He added that the company continues to be aggressive at retaining those customers and aggressive in acquiring new ones.
International small-to-medium-sized enterprise (SME) and large corporate spending, inclusive of travel and entertainment (T&E), was up 19% year over year, the largest growth rate of any corporate or consumer sector at Amex. Total T&E spending by international clients — which is about two-thirds consumer and one-third business — increased 23% year over year to $25 billion.
The growth indicates “international has come back even a little quicker than we had thought within our three-year horizon,” Squeri said.
Overall T&E spending by American Express corporate customers increased 8% year over year to $27 billion in the second quarter, although overall corporate spending showed only slight growth compared with consumer spending in the quarter.
The total T&E spending repeated the $1 billion quarter-over-quarter growth seen in the first quarter, following three quarters that had remained steady at $25 billion. Overall corporate spending, which includes T&E as well as goods and services, was up 2% year over year for both large and global US corporate and US SME customers.
That compares with a 34% increase for large and global accounts and 6% increase for SME accounts in the first quarter, but the previous quarter also “lapped the impact” of the omicron Covid-19 variant the previous year, which elevated growth rates, said Amex CFO Jeff Campbell. “We are now seeing the more stable rates we expect are more representative of the kind of growth rates we will see in the balance of the year,” he said. Campbell is retiring from his position next month.
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