American Express posted a 28% rise in third-quarter profit as higher card spending and increased Platinum Card fees lifted earnings. The company reported net income of USD 3.71 billion, or USD 5.42 per share, while announcing plans to cut about 3,500 jobs. The reductions amount to 5% of its workforce. The New York-based company also raised the lower end of its full-year adjusted profit forecast after the stronger quarter.
For the quarter ended September 30, adjusted earnings reached USD 4.68 per share, above analysts’ expectations of about USD 4.48. The adjusted figure excludes a one-time gain from the sale of its stake in Global Business Travel Group. That sale boosted reported profit but not adjusted earnings for the quarter.
Higher Platinum Card Fees Drive Revenue Growth
Revenue increased 9% to USD 20.1 billion. Meanwhile, total spending across American Express-issued cards, known as billed business, grew 8% to USD 454 billion. Fee income also rose as the company moved most Platinum members onto its revised card.
The company updated the Platinum Card last year, adding benefits while lifting its annual price from USD 695 to USD 895. The USD 200 increase tested customers’ willingness to pay more for the card.
American Express said nearly all cardholders who had transitioned to the new fee chose to stay. Net card fees rose by more than USD 400 million from a year earlier.
The product update drew generally positive reviews when American Express introduced it. Still, higher annual charges were only part of the quarter's growth. Customers also made more purchases, giving the company a second source of revenue gains.
Affluent Cardholders Increase Travel and Everyday Spending
The average customer charged USD 6,735 during the quarter, equivalent to USD 2,245 per month. That represented a 5% increase from a year earlier. The number of transactions per cardholder rose as well, indicating more frequent card use.
Travel and entertainment spending climbed 10% from the same period last year. Airline purchases rose 13%, while restaurant spending increased 9%. Those categories contributed to the growth reported across the company's customer base.
Chief Financial Officer Christophe Le Caillec said inflation accounted for some of the increase in spending. In particular, higher airline ticket prices affected the dollar value of bookings. More transactions per member also helped lift the figures.
Airlines have increased fares amid rising fuel expenses linked to the Middle East conflict and disruptions to global oil flows. As a result, part of American Express's airline spending growth reflected higher ticket prices rather than additional travel.
The company's focus on wealthier consumers remains central to its business. David Wagner of Aptus Capital Advisors said spending among high-income customers showed no signs of stress, unlike the pressure facing lower-income consumers.
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Job Cuts Follow Cost Pressures as Earnings Outlook Improves
Despite stronger earnings, American Express announced its first major workforce reduction in roughly a decade. The planned 5% cut affects approximately 3,500 employees. Chief Executive Steve Squeri told investors the move aimed to improve efficiency, not respond to weaker demand.
Operating expenses have drawn investor attention as American Express competes with Capital One and JPMorgan Chase. Card perks and rewards cost money to maintain, adding pressure even as higher fees and customer purchases support revenue.
At the same time, American Express has continued investing in younger customers, including Generation Z and millennials. The company sees those groups as an opportunity to build long-term customer relationships and expand its presence in global markets.
Following the results, American Express lifted the bottom end of its adjusted full-year earnings forecast. It now expects USD 17.60 to USD 17.90 per share, compared with its previous range of USD 17.30 to USD 17.90.
Final Thoughts
American Express posted higher profit and revenue as card spending and Platinum fees grew. Most customers moved to the costlier card and kept their memberships. The company also announced 3,500 job cuts and lifted its annual earnings forecast, linking the staffing changes to efficiency rather than slowing demand.