AmEx gets reprieve after JPMorgan hikes Sapphire Reserve fee

Bloomberg

American Express Co has high hopes for 2020, predicting earnings that surpassed many analysts’ expectations and prospects for “more rational” competition from its biggest rivals.
After sweetening the bonuses on some of its most popular products, including the Green card, AmEx said overall rewards costs climbed 8% to $2.72 billion during the fourth quarter. That was less than the $2.76 billion average of analysts surveyed by Bloomberg.
“I do think the environment, while still very competitive, perhaps has become a little more rational” on rewards spending, Chief Financial Officer Jeff Campbell said in an interview. “But what’s more important for us — and what’s trickier for our competitors to replicate — are things like our global lounge collections, the global travel benefits.”
Earlier this month, JPMorgan Chase & Co said it would raise the annual fee on its popular Chase Sapphire Reserve card to $550 a year. That followed a move last year by Citigroup Inc, the world’s largest credit-card issuer, to discontinue free trip insurance and price-protection guarantees on all its US cards.
The changes could help ease pressure on expenses at AmEx, which retooled its Green card in October to add points for spending on all travel, including transit. The company has also been adding perks to the app after buying the restaurant reservation firm Resy and investing in technology to make it easier for customers to use cards
online.
AmEx said it expects per-share profit of $8.85 to $9.25 this year, compared with the $8.95 that analysts in a Bloomberg survey were expecting. The firm forecast revenue would rise 8% to 10% for the year.