(Bloomberg) -- American Express Co. saw spending on its network soar as customers continued to take to the skies despite mass cancellations and long waits at airports, leading the firm to raise its forecast for full-year revenue.

Volumes on the firm’s network jumped to $394.8 billion, topping the $383.3 billion average of analyst estimates compiled by Bloomberg. That helped boost revenue 31% to a record $13.4 billion, though expenses climbed as well, partly the result of customers taking advantage of travel-related benefits. 

The jump in spending was “driven by the robust rebound in global travel and entertainment spending, which surpassed pre-pandemic levels for the first time in April,” Chief Executive Officer Steve Squeri said in a statement Friday. “Goods and services spending, which is the largest category of spending on our network, continued its strong growth in the quarter, and spending by millennial and Gen Z card members increased 48%.”

The revenue increase at AmEx comes as US airlines limit flying this quarter and for the rest of the year. Carriers have been hamstrung by costly flight cancellations and delays amid labor shortages and air-traffic congestion, limiting their ability to take full advantage of a rebound in demand from customers eager to travel again after being grounded earlier in the Covid-19 pandemic. 

AmEx said it now believes revenue will climb as much as 25% this year, an increase from its previous forecast that revenue would rise as much as 20%. The company reiterated its full-year earnings guidance of $9.25 to $9.65 a share.

The firm’s shares gained 4.2% to $156.55 at 7:28 a.m. in early New York trading. They had dropped 8.2% this year through Thursday, less than the 16% decline in the S&P 500 Financials Index.

The resurgence in vacations and business trips came at a cost, with New York-based AmEx attributing the surge in expenses to use of travel benefits as well as higher network volumes and increased compensation. Overall expenses climbed 32% to $10.4 billion, topping analyst estimates, as marketing costs jumped.

Adding Customers

“We do plan to spend more on marketing than we originally intended when we went into this year because we’ve had such good opportunities to bring in high credit quality, high spending, high fee-paying card members into the franchise,” Chief Financial Officer Jeff Campbell said in an interview.

For now, AmEx and its rivals have benefited from the historic levels of inflation across the US since merchants pay credit-card lenders a percentage of the purchase price every time a consumer swipes a card at checkout. Still, investors have worried that higher prices will ultimately temper economic growth and prompt a surge of defaults. 

AmEx set aside $410 million in provisions for credit losses, compared with the $460.2 million analysts were expecting. Still, the move crimped profits, which dropped 14% to $1.96 billion, or $2.57 a share. 

“We have been able to deliver exceptional results while navigating a complex macroeconomic environment,” Squeri said. “As we look ahead, we remain confident in our ability to successfully execute against our long-term growth plan aspirations.”

(Updates with shares, CFO’s comments starting in sixth paragraph.)

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