This made me think of the disclosure when the CSR was refreshed- they specifically indicated that some of the new credits would be in place through certain dates in 2027, which I am assuming is the initial contract term with those companies
my guess is it’s just disclosing differently.
Chase is being cautious and saying the credits end of next contract, and will extend if the contract is. Less pressure on them to lock in an extension, and presumably shifts disappointment and liability if they don’t - they can point if customers complain to the specific language with an end date, then extend it again with a new contract. They have already done this with DoorDash and Lyft.
Amex, despite the contracts having an end date, will presumably disclose the end date if and when they decide it’s not worth extending based on terms. This presumably allows them to recruit customers without the expectation of an end, and will deal with disappointment around that if and when it happens.
Originally Posted by
bzcat
Why would they want to stop it? This is an interest free working capital line of credit for Lulu. They probably cleared $20 million in gift card sales in the last 2 weeks which they don't have to redeem until later. That's free money.
not now. See below. Generally, retailers don’t book the sales of gift cards until they are redeemed. That leaves a lot of outstanding cash that they physically receive but can’t ’book’ until a sale - and they need to pay out the costs for it at that time. If, for example, they want to spread out the cost of the credits [roughly] equally throughout the year, the quarterly credits are a way to do that. But if someone buys a gift card each quarter, then redeems all $300 at once, that consistency is gone.
Unless Lululemon is bearing the cost of the credits, in which case the cash goes back to American Express -and- the unredeemed gift cards sit on their books as a liability.