American Express Beats Profit Forecasts As Strong Spending Drives Q2 Growth
American Express reported stronger than expected second quarter earnings after higher spending by its affluent customer base and improving credit performance helped drive profits above analysts' forecasts.
The financial services company posted net income of $3.11 billion, or $4.53 per share, representing an 8% increase from the same period last year. Analysts had expected earnings of approximately $4.40 per share, making the results another quarter of better than anticipated performance for the company.
Revenue increased by 10% to $19.64 billion, supported by continued growth in cardholder spending, higher fee income, and increased interest revenue. Average spending per cardholder rose to $6,759, compared with $6,393 during the same quarter last year, reflecting resilient consumer demand among American Express' premium customer base.
The company added approximately three million new cardholders during the quarter, with around 75% choosing products that carry annual fees, including the popular Platinum and Gold cards. American Express said younger consumers, particularly Millennials and Generation Z, continue to account for a significant share of new premium card applications.
Chief Executive Stephen Squeri said customer spending remained healthy across travel, dining, entertainment, and retail categories. Rather than maximising short term profits, he said the company intends to continue investing in marketing, technology, artificial intelligence, and customer benefits to support long term growth.
American Express raised its 2026 revenue growth forecast to 10%, citing confidence in continued customer spending. However, it maintained its full year earnings guidance of $17.30 to $17.90 per share, as increased investment spending is expected to offset some of the additional revenue.
Despite the strong quarterly performance, the company's shares fell after the announcement as some investors had hoped management would also increase its profit outlook. Analysts noted that while revenue growth remained solid, the decision to prioritise long term investment over higher short term earnings disappointed parts of the market.
American Express said it remains well positioned for the second half of the year, with strong customer spending, improving credit quality, and continued demand for premium products expected to support future growth despite increasing competition in the global credit card market.
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