Premium spending boom and Platinum Card refresh power Amex’s growth.
American Express (AXP) delivered another strong quarter, beating Wall Street’s expectations and raising its full-year outlook as affluent customers continued to spend heavily and the company’s revamped Platinum Card drew record engagement.
3 Key Points
- Earnings Beat: Q3 EPS rose 19% to $4.14, topping forecasts of $3.99.
- Record Spending: Billed business reached $421 billion, up 9% year-over-year.
- Strong Outlook: Amex raised full-year guidance to $15.20–$15.50 per share in earnings.
Record Quarter Driven by Strong Spending
American Express reported third-quarter earnings of $2.9 billion, up 16% from the same period last year, as total revenue climbed 11% to $18.4 billion. The results exceeded analyst estimates and extended the company’s streak of seven consecutive quarters of earnings beats.
Average card member spending rose 5% year-over-year to $6,387, while total billed business hit a record $421 billion, surpassing expectations of $415 billion. Net interest income rose 12% to $4.5 billion, reflecting increased loan balances and healthy credit trends.
Chief Executive Officer Stephen J. Squeri said the results show “the durability of our premium customer base and strong engagement across all products.”
How Is the Platinum Card Refresh Performing?
In September, American Express unveiled a refreshed version of its flagship Platinum Card, raising the annual fee to $895 and introducing enhanced perks worth more than $3,500 annually, including $400 in dining credits at Resy restaurants and expanded hotel benefits.
The update is off to a record start. Amex received 500,000 upgrade requests within three weeks, reaching its year-end target in less than a month. New U.S. Platinum account acquisitions have doubled compared to pre-refresh levels, signaling strong consumer appetite despite higher fees.
Squeri called it “the strongest start we’ve ever seen with a refresh,” noting that demand has exceeded all expectations.
How Are Credit and Costs Holding Up?
Despite the surge in spending, credit quality remained stellar.
- Net write-off rate held steady at 1.9%.
- Loans past due more than 30 days were 1.3%, unchanged from a year earlier.
- Provisions for credit losses declined to $1.3 billion, down from $1.4 billion last year.
Operating expenses rose modestly to $13.3 billion, driven by higher engagement costs tied to travel and lifestyle perks. However, earnings growth outpaced expenses — a sign of disciplined cost management.
Chief Financial Officer Christophe Le Caillec highlighted that new Platinum card applicants have even better credit profiles than before, with average credit scores about 15 points higher.
What It Means for Investors
American Express’s business model — catering to affluent, high-spending customers — continues to deliver results. The combination of record spending, strong credit metrics, and higher fee revenue reinforces Amex’s competitive edge in the premium card market.
The raised full-year forecast of $15.20–$15.50 in EPS and 9%–10% revenue growth reflects growing confidence in sustained momentum heading into 2025. Shares climbed roughly 4% following the report and are up about 13% year-to-date.
While richer perks mean higher customer engagement costs, they also deepen loyalty and drive more card usage. Historically, this strategy has helped Amex expand margins while maintaining best-in-class credit performance.
Conclusion
American Express’s latest quarter highlights a winning formula: premium products, disciplined risk management, and loyal high-spending customers. The Platinum Card refresh has reignited engagement, and the company’s raised outlook signals management’s confidence in continued growth.
With credit metrics stable and demand strong, AXP remains one of the most resilient and well-positioned financial stocks heading into 2025.
FAQs
How much did American Express earn in Q3?
Amex earned $2.9 billion, or $4.14 per share, beating analyst expectations of $3.99 per share.
What drove Amex’s strong results this quarter?
Higher card member spending — especially among affluent consumers — and strong demand for the refreshed Platinum Card fueled revenue growth.
How did the Platinum Card refresh perform?
Exceptionally well. Amex received 500,000 upgrade requests in just three weeks, doubling new account acquisitions versus pre-refresh levels.
What is Amex’s full-year outlook?
The company expects earnings per share between $15.20 and $15.50 and revenue growth of 9%–10% for the year.
Are credit risks increasing?
No. Credit quality remains stable, with delinquency and write-off rates unchanged from last year and provisions for credit losses declining slightly.
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