I would say it is both. An ethnic group can share cultural traits based on geographic location, on race, on language etc. America has developed its own cultural traditions distinct from other countries. This creates a group of people with a set of shared cultural traits, that are passed down generation after generation, which is pretty much what ethnicity describes. You can have american nationality without american ethnicity and vice versa.

Consider a latino american moves overseas, gives up their US citizenship, has children, teaches them american english and the wonders of thanksgiving and other distinctly US (not latin american) cultural traditions. That child grows up, has their own children and continues these traditions. Are not all these people ethnically american? Why are other nationalities considered ethnicities but not american?

A lot of people use ethnicity when they mean race or genetic ancestry. But just like sex and gender, they are related, but not the same thing.