Travel and entertainment spending by American Express U.S. commercial customers increased 4% year over year in the first quarter even as the company reported "soft" spending trends from its small and midsize commercial customers.
The 4% increase brought total T&E spending by U.S. commercial customers to $28 billion in the quarter, up from $25 billion in the first quarter of 2023 and from $26 billion in the fourth quarter of 2023, Amex reported. U.S. commercial customer spending on goods and services was $99 billion, up 1% year over year but down from $105 billion in the previous quarter.
Total spending, inclusive of T&E and goods and services, was up 5% year over year among Amex's large and global U.S. customers, which account for just under a fifth of total commercial customer spending. Among small and midsize enterprises (SME), the increase was 1%.
"The SME billed business has been in that 1% to 2% range for a year now," Amex CFO Christophe Le Caillec said in an earnings call on Friday. "We think that this is macro-driven, and we have a ton of data that confirms that it's not specific to American Express, and the rest of the industry is experiencing similar trends."
T&E spending by international customers, both consumer and commercial combined, increased 14% year over year in the first quarter to $27 billion. Spending by international commercial customers on both T&E and goods and services was up 11% year over year and made up 35% of Amex's total international business.
Amex chairman and CEO Stephen Squeri said the company expects continued growth in its international business.
Amex reported total revenue of $15.8 billion for the quarter, up 11% year over year due to increased card member spending and higher net interest income. Its first-quarter net income was $2.4 billion, up from $1.8 billion in the first quarter of 2023.
Source: Business Travel News