NEW YORK (Azat TV) – American Express reported a 28% surge in third-quarter profit, reaching $3.71 billion, driven by robust spending among affluent cardmembers and the successful rollout of its higher-fee Platinum Card. The financial services giant posted a per-share profit of $5.42, or $4.68 excluding a one-time gain from the sale of its stake in Global Business Travel Group, beating Wall Street projections.
The company’s financial performance highlights the resilience of its wealthy customer base, who continued to travel, entertain, and charge purchases despite broader inflationary pressures. According to The Associated Press, the average AmEx customer spent $6,735 on their cards last quarter, amounting to $2,245 per month—a 5% increase from the previous year. Chief Financial Officer Christophe Le Caillec noted in an interview that part of this spending increase is tied to persistent inflation, particularly in airline fares and travel expenses, though transaction volumes per cardmember also grew.
The $895 Platinum Card Test
A central question for analysts following the introduction of enhanced perks last year was whether cardholders would accept a $200 price increase on the flagship Platinum Card, raising the annual fee from $695 to $895. AmEx executives confirmed that nearly all customers who transitioned to the new pricing tier have retained their cards.
This retention success fueled a substantial revenue boost, with net card fees climbing by more than $400 million compared to the same period last year. The strong adoption rate underscores the brand’s pricing power within the luxury credit market, even as it faces intense competition from rivals such as JPMorgan Chase and Capital One in managing expensive rewards programs.
Workforce Reductions and Outlook
Alongside its earnings report, American Express disclosed its first major workforce reduction in roughly a decade, laying off 5% of its staff—approximately 4,000 employees—during the previous quarter. Chief Executive Officer Steve Squeri emphasized to investors that the job cuts were implemented to streamline operations and enhance efficiency rather than responding to any underlying business downturn or weakening consumer demand.
Bolstered by strong quarterly results, American Express updated its full-year guidance, raising the lower end of its expected adjusted earnings. The company now projects full-year adjusted profit to fall between $17.60 and $17.90 per share, compared to its previous forecast range of $17.30 to $17.90 per share.