Nov 21, 2024 • 6 min read
05.11.2024 - 21:03 / skift.com / Sean Oneill
American Express Global Business Travel (Amex GBT) said Tuesday it continued to pursue a two-pronged strategy as the world’s largest travel-management company: maintaining its lead in serving multinational corporations while aggressively expanding into the fragmented small- and medium-sized business market.
The strategy led to measured growth in the third quarter. Transaction volume rose 9% year-over-year, while revenue rose 5%.
Yet the company posted a net loss of $128 million. It hasn’t broken even since the pandemic.
The company said its cost-cutting program this year should generate $100 million in savings. The cuts were part of a three-year plan for cost reductions that began last year and included layoffs. The $100 million figure for this year was first quantified on Tuesday.
Adjusted EBITDA jumped 23% to $118 million, with 300 basis points of margin expansion.
Amex GBT has seen share gains among two customer segments: large corporates and smaller players.
Amex GBT said it won $3 billion worth of new business (measured as “expected annual average total transaction value”) over 12 months through September 30.
About two-thirds of that estimated value came from new small- and medium-sized clients.
Yet existing customer spending diverged across the segments. Global multinationals showed healthy 8% transaction growth while existing small and medium enterprises limped along at 2%. This divergence matters because the “long-tail” segment of smaller companies represents AmexGBT’s biggest growth opportunity.
Among large corporates, Amex GBT already has about 40% market share. It leverages network effects to maintain its position, enjoying a 97% client retention rate over the past year.
The large corporate segment is resilient. Amex GBT’s top 100 customers project an approximately 5% increase in travel spending in the fourth quarter, driven by an expected strong performance in the financial services, pharma, and automotive sectors.
By growing through acquisitions, Amex GBT gains scale, allowing it to negotiate better supplier prices. Analysts at Evercore ISI noted that the company has offered its corporate clients an average 10% discount versus publicly available fares.
Meanwhile, among businesses that spend less than $20 million a year on air travel, Amex GBT estimated it had just about a 6% share of these companies that use outside help to manage their travel.
Small- and medium-sized businesses spend about $675 billion a year on business travel without the help of travel managers — twice the transaction volume managed by agencies like Amex GBT today.
Credit Suisse analysts estimated that if all unmanaged spending shifts to managed, Amex GBT and its rivals like Navan and TravelPerk could capture over
Nov 21, 2024 • 6 min read
Take your pick: Basic economy, standard economy or…. something slightly better, but pricier?
This as-told-to essay is based on a conversation with Zachary Gerth, cofounder of StartAbroad , a concierge international relocation service. It has been edited for length and clarity.
If you must be gay—and, dear reader, you really must—then it’s only natural that you’ve found yourself here, consulting our list of the best destinations for LGBTQ+ travelers to visit. While it’s true that queerness may be temporarily masked for survival reasons and that travelers should be prepared to compromise on aspects of their presentation out of respect for local customs and mores, sometimes that’s just not going to work. Many countries around the world are safe and fabulous destinations for openly LGBTQ+ travelers. (Admittedly, we're speaking generally here; it’s important to note it only takes one incident perpetuated by one bad actor or group to soil an individual’s trip—and that can happen anywhere.) So what are the places where you don’t have to put your most authentic self away?
You pay hundreds of dollars annually for a card that offers you lounge access — and then you get to the airport only to face a long line at the lounge entrance.
Big Sky, Montana, has always been one of the greatest places to ski in the US. Lone Mountain’s vast expanse of untamed terrain, coupled with its pristine powder, has drawn skiers and snowboarders from around the globe. But in recent years, this area has seen a surge in developments with new luxury accommodations, upscale dining and chic as-hell après-ski options, and state-of-the-art lifts with heated seats, elevating its status to a world-class winter destination. And although, yes, the resorts and high-end hotels here are opulent, catering specifically to powderhounds, but you’ll be looking at least $500 per person/night. For a significantly lower price (per head), you can rent a luxury home on Airbnb and have the benefit of space, a kitchen, and a home to return to after a day on the slopes. Great for families and groups of friends, these ski-in/ski-out Airbnbs in Big Sky have exceptional locations near lifts and extras like hot tubs and fireplaces for a little added zhuzh.
Southwest Airlines is making an interesting change to service on Hawaii's Big Island.
The Signify Business Cash℠ Card by Wells Fargo has no annual fee and earns a flat 2% cash-back rate on purchases, making it a solid choice for businesses looking for simplicity. However, it doesn't offer bonus categories or ways to maximize redemptions, so those who want more perks will need to look elsewhere. Card rating*: ⭐⭐⭐
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