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American Express Co (AXP.N) beat first-quarter earnings estimates on Friday as spending on credit cards rebounded from a year earlier, offsetting a jump in costs from higher rewards spending.

The company said its shares fell nearly 2% in early trade after spending rose 34% to $9.06 billion due to higher customer retention costs.

However, Amex executives sought to reassure investors that the company’s strategy was paying off. American Express added 3 million new proprietary cards, with U.S. Consumer Platinum and Gold and U.S. Business Platinum hitting record highs during the quarter.

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“Overall earnings momentum … is driven by our investments in marketing, value proposition, reach, technology and people,” Chief Financial Officer Jeffrey Campbell said on the earnings call.

Consumer spending in the U.S. increased as pandemic restrictions eased and COVID-19 receded from its highs, as Americans made up for lost travel, shopping and dining out.

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Amex travel and entertainment spending rose 121% on a currency-neutral basis, despite the presence of Omicron in January and early February.

Spending on goods and services, the largest payment category at American Express, rose 21%.

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Campbell added that the remnants of the business there could eventually lead to write-downs, but that didn’t matter.

American Express’s net income fell 6% to $2.1 billion, or $2.73 a share, in the quarter ended March 31. Analysts had expected $2.44 a share, according to IBES data from Refinitiv.

Total income excluding interest expense rose 29% to about $11.74 billion.

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