(Bloomberg) -- American Express Co. is putting the pandemic behind it, boosting forecasts for revenue and profit after spending on its cards surged to a record.
Revenue will climb as much as 20% this year while earnings could reach $9.25 to $9.65 a share, the company said in a statement Tuesday. AmEx has long said 2022 would be the year it reaches goals originally set two years ago, before the pandemic took hold. But the new targets far surpass even those goals, which predicted revenue growth in the range of 8% to 10% and per-share profit of $8.85 to $9.25.
“We are raising our aspiration to generate sustainable revenue and earnings growth,” Chief Executive Officer Steve Squeri said in the statement. “Longer term, as the economy reaches a steady state, our aspiration is to achieve revenue growth in excess of 10% and earnings-per-share growth in the mid-teens.”
Overall spending on AmEx’s network soared 29% to $368.1 billion in the final three months of last year, even as the highly contagious omicron variant disrupted holiday plans around the world and started a fresh round of lockdowns. The spending surge helped push revenue up 30% to $12.1 billion in the quarter, which was higher than analysts had predicted.
Shares of the company rose 3.2% to $164.06 at 7:06 a.m. in early New York trading.
AmEx also said it would raise its quarterly dividend for the first time since 2019, boosting the payout 20% to 52 cents a share beginning this quarter, according to the statement.
AmEx -- long known for its travel and dining perks -- has been revamping some of its most popular products and focusing more on wellness and lifestyle benefits as the pandemic drags on. When it overhauled its Platinum card last year, the New York-based company added statement credits for entertainment products, such as SiriusXM or Audible subscriptions, as well as $25 a month toward membership with the high-end fitness club Equinox.
The company has vowed to spend more on marketing in recent quarters as it seeks to add new customers. Overall costs jumped 29% to $9.8 billion, topping the $9.31 billion average estimate.
AmEx is pursuing a “new growth plan that will enable us to continue investing at high levels in our customers, brand and talent,” Squeri said. “Our performance to date and the lessons we have learned have strengthened our conviction in this strategy.”
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