Core Insights - American Express Company (AXP) has established a multi-year strategic partnership with Toast, Inc. to enhance hospitality experiences by integrating guest data from its restaurant reservation platforms into Toast's systems [1][2] - This partnership strengthens AXP's position in the restaurant and hospitality ecosystem, creating a seamless guest experience from reservation to payment [2][4] - AXP differentiates itself from competitors by linking card membership to exclusive, data-enhanced hospitality services, which can drive higher loyalty and spending among cardmembers [3][5] Company Strategy - The integration of Resy and Tock listings into Toast's platforms enhances visibility and marketing for restaurants, potentially improving retention and attracting more establishments to Toast [4][7] - AXP's approach allows it to deepen customer relationships and expand merchant acceptance, while Toast benefits from new traffic sources and tools [4][5] Competitive Advantage - AXP sets itself apart from Visa and Mastercard by integrating deeply into the hospitality journey, offering personalized dining experiences and creating value beyond transactions [5][6] - This end-to-end control reinforces AXP's premium image and positions it as a hospitality partner rather than just a payment processor [5][6] Financial Performance - AXP shares have declined 0.5% year-to-date, while the industry has grown by 2.3% [6] - AXP trades at a forward price-to-earnings ratio of 17.87, below the industry average of 20.89, with a Value Score of B [9] - The Zacks Consensus Estimate for AXP's 2025 earnings is $15.26 per share, indicating a 14.3% increase from the previous year [10][12]

Industry Trend - Models and influencers can easily book entire days of meals and experiences in exchange for social media posts [1] - Regular people face fierce competition for restaurant reservations on platforms like Resy and OpenTable [1]

Financial Data and Key Metrics Changes - The company aims for a revenue growth target of 10%, driven by high single-digit billings growth, continued card fee growth, and lending growth slightly faster than billings [18] - The US consumer business has grown at a CAGR of 10.5% since 2019, indicating outperformance compared to the industry [18] - The company has about 5% of accounts in the US but 25% of fee-paying accounts, suggesting significant room for growth [18] Business Line Data and Key Metrics Changes - The millennial and Gen Z customer base has increased from 18% of volume in 2019 to 35% in the last quarter, growing at a 15% rate [10] - 60% of new customer acquisitions are from millennials and Gen Z, with 75% of gold and platinum cardholders in the US belonging to these demographics [11] - The SME segment has shown flat growth, while the overall commercial business has seen about 3% growth with nearly 8% revenue growth [59] Market Data and Key Metrics Changes - International markets are growing in the teens, with the company holding less than 6% market share in its top five markets [68] - The company has made significant progress in increasing coverage in 12 markets, aiming for 80% coverage in targeted cities [69] Company Strategy and Development Direction - The company is focused on customer-centric innovation and adapting to meet the needs of various demographics, particularly millennials and Gen Z [4][6] - The closed-loop network is a key differentiator, allowing for better data collection and marketing capabilities [13][14] - The company is investing in technology and replatforming backend systems to enhance operational efficiency and customer experience [90][92] Management's Comments on Operating Environment and Future Outlook - Management believes that consumer sentiment does not significantly affect their customer base, with unemployment being a more critical factor [50][51] - The company is optimistic about growth opportunities in international markets and the small business segment, which is still nascent [70] Other Important Information - The company has been investing in AI since 2010, which enhances underwriting decisions and fraud prevention [92] - The company is focused on maintaining a balance between marketing spend and operational expenses to ensure sustainable growth [78][80] Q&A Session Summary Question: How does the company plan to grow billings? - The company sees significant room for growth in billings, with a total addressable market (TAM) growing in mid to high digits annually [18] Question: What is the state of spending currently? - Spending has remained consistent across various segments, with strong performance in restaurants and stable airline spending [21][22] Question: How does the company ensure value for diverse demographics? - The company offers a variety of benefits tailored to different demographics, ensuring that each group finds value in their products [27][28] Question: What is the strategy behind the recent acquisition of Center? - The acquisition aims to enhance expense management capabilities, targeting middle-market companies and integrating with existing products [64][66] Question: How does the company view the competitive landscape? - The competitive environment is intense, but the company believes it has a strong position and continues to innovate to stay ahead [44][46]