American Express CEO Ken Chenault will retire at then end of the year after 16 years in the role.
Vice Chairman Stephen Squeri, who previously ran the company’s corporate card business, will succeed him. (American Express President Ed Gilligan had been expected to become CEO, but he died on a business trip two years ago.)
American Express was a strong performer for much of Chenault’s tenure but faced real challenges in recent years as it lost the Costco business and had to compete far more aggressively for premium cardholder business that was traditionally its exclusive domain.
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The company’s shares are up 50% so far this year though, after being beaten down in the aftermath of the Costco loss and other setbacks. They did score exclusivity with Hilton taking that away from Citibank, though it’s small consolation for the significant market share they gave up with the Costco loss.
Gambits that looked incredibly promising — such as expanding into unbanked segments via plays with Walmart and Target, and building a coalition rewards program for retail (Plenti) — didn’t turn out as profitable as hoped. Increasingly they focus on lending (not merely charge cards) and the small business segment.
Going forward they face a Supreme Court case in the coming term. And they face significant competition with Chase as they fight to protect their Starwood co-brand deal (their second largest travel co-brand after Delta) now that Starwood has been acquired by Marriott — which has a longstanding relationship with Chase.