In response to customer dissatisfaction, Delta Air Lines (NYSE:DAL) has revised its policy to offer 10 free annual lounge days to American Express (NYSE:AXP) Platinum and Business Platinum cardholders, up from the initial six. This decision comes after Delta's previous move to limit lounge access, aiming to manage overcrowding and cater to premium customers. The changes, announced on Friday, were led by Delta CEO Ed Bastian, who is known for his customer-centric approach.
According to InvestingPro Tips, Delta's strong earnings and consistently increasing earnings per share should allow the company to continue these generous dividend-like offerings. In fact, Delta's net income is expected to grow this year, further enhancing its ability to roll out customer-centric policies. For more insights like these, you can visit the InvestingPro Tips page.
Despite threats of cancellation from customers due to the changes, American Express (Amex) reported no significant increase in attrition. Christophe Le Caillec, CFO of Amex, stated that membership remained stable even after the policy shift. The $695-a-year cards offer $400 in annual credits for airline and hotel spending.
InvestingPro Data indicates that Amex, with a market cap of 105.91B USD and a P/E ratio of 14.57, has maintained a steady financial performance. The company has been profitable over the last twelve months and is expected to continue its profitability this year, according to InvestingPro Tips. The company's revenue growth has been slowing down recently, but it is still a prominent player in the Consumer Finance industry.
The policy change did not affect the acquisition or usage of Delta SkyMiles Reserve cards. Amex CEO Steve Squeri supported the adjustments aimed at managing overcrowding in lounges and catering to premium customers.
Delta is Amex's largest co-brand partner, contributing 21% of Amex's loans and 9% of its spending, according to an investor presentation last year. Amex's internal data indicated that six visits would have accommodated the majority of cardholders. With a market cap of 20.8B USD and a P/E ratio of 6.08, Delta is also a significant player in the Passenger Airlines industry, as per InvestingPro Data. The revised policy now allows cardholders ten free annual lounge days beginning in January, showing Delta's commitment to its customers.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.