American Airlines Chooses Citi As Sole Card Partner
American Airlines has finalized a new credit card agreement that will make Citi its exclusive co-branded credit card partner starting in January 2026. This strategic move means the airline will end its existing relationship with Barclays and strengthen its long-standing ties with Citi, a deal that is expected to enhance revenue and profitability over the coming years.
Co-branded credit card partnerships are a crucial source of revenue for major airlines. Under these arrangements, carriers sell frequent flyer miles to banks in exchange for substantial payments, while banks gain access to a large pool of loyal travelers who are incentivized to use the airline’s co-branded cards for everyday purchases. This mutually beneficial setup drives billions of dollars in income, enabling airlines to invest in improved services, expand route networks, and maintain competitive fares.
American Airlines, headquartered in Fort Worth, Texas, has emphasized that the transition to Citi as its sole partner will help the company grow these co-branded card revenues by an estimated 10% per year. Between October 2023 and September 30, 2024, the airline reported $5.6 billion in revenues from its co-branded credit card agreements and other partnership deals. By focusing on a single banking partner, American aims to streamline its offerings and capitalize on the stability and scale that Citi brings to the table.
The airline revealed that it will begin transitioning existing Barclays cardholders to Citi in 2026. Although specific details about how this transition will occur have not yet been disclosed, American’s decision signals a more unified loyalty and credit card strategy. Citi is also set to handle card sign-up promotions, including those offered during flights and at airports, giving the bank greater exposure to a captive audience of travelers.
American’s decision to consolidate its co-branded credit card partnerships can be traced back to its 2013 merger with US Airways. The consolidation of operations, technology, and loyalty programs created a complex landscape for card agreements. After considering various possibilities, the airline’s move to make Citi its exclusive partner will likely simplify these arrangements and strengthen the American AAdvantage loyalty program, reinforcing its position in a highly competitive market.
While American’s co-branded revenue is substantial, it still trails behind Delta Air Lines, which earned nearly $7 billion through its exclusive partnership with American Express last year. Delta aims to grow that figure even further to $10 billion over time. By streamlining its own partnerships, American hopes to better compete with Delta’s success story, leveraging Citi’s resources and expertise in consumer finance to boost earnings and enhance customer loyalty.
Investors reacted positively to the announcement. American Airlines shares rose more than 6% in premarket trading following the news, as well as an upward adjustment in the airline’s fourth-quarter revenue forecast. The move indicates that Wall Street views a unified co-branded credit card strategy, anchored by a trusted financial partner like Citi, as a positive step toward long-term growth.
Ultimately, American’s decision to select Citi as its sole credit card partner reflects a strategic effort to refine its loyalty program, capitalize on financial synergies, and position itself for robust growth in the competitive airline industry.
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Sources: AirGuide Business airguide.info, bing.com, cnbc.com