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The
New York-based company said it earned $2.9 billion in the
quarter, up 16% from $2.51 billion in the same period a year
earlier. On a per-share basis, the company earned $4.14,
compared to $3.49 a year earlier. The results beat analysts’
expectations.
Once again, AmEx benefited from increased spending on its cards
across all its products in the quarter. The company last month
refreshed its iconic Platinum Card, increasing the perks and
rewards earned on the card but also increasing the annual fee to
$895.
The high net worth credit card market has become a hotbed of
competition, particularly this summer and fall when the major
credit card companies launched new products or refreshed
existing cards in order to entice customers to spend on their
products. JPMorgan Chase revamped the Chase Sapphire Reserve
Card in June, and Citigroup launched Citi Strata in September.
AmEx shared data with investors that indicate customers were not
turned off by the higher annual fee and increased competition
from new products. The company got 500,000 requests from
customers to convert their card to the new mirrored finish in
three weeks, which company executives expected to get 500,000
requests by year-end.
“The initial customer demand and engagement exceeded our
expectations, with new U.S. Platinum account acquisitions
doubling compared to pre-refresh levels,” said Steve Squeri, CEO
and chairman, in a statement.
Average spend on AmEx cards in the quarter was $6,387, the
company said, up 5% from a year earlier. Card members continue
to increasingly carry a balance on their cards as well, with the
company now reporting $138.95 billion in loans, up 8% from a
year earlier.
American Express now expects to post earnings per share of
$15.20 to $15.50 for the full year.
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