American Express Posts Strong Q2 Profit as Affluent Spending Shields Growth

18 July 2025

American Express revealed second-quarter earnings that topped Wall Street expectations, showcasing how its strategic concentration on high-income customers has insulated it from broader economic softness. The credit card giant reported adjusted earnings of $4.08 per share for the quarter ending June 30, significantly above analysts' estimates of $3.89. Revenue climbed 9 percent year-on-year to $17.9 billion, exceeding the projected $17.7 billion—a reflection of robust demand for premium services despite broader consumer caution.

Investor reaction was immediately positive, with shares rising about 1.4 percent in premarket trading. So far, American Express stock has seen a 6.3 percent gain in 2025, closely tracking but slightly behind the S&P 500's 7 percent improvement. CEO Stephen Squeri emphasized his confidence in the company's direction, stating that AmEx remains firmly positioned as the leader in premium credit services.

Behind the headline numbers, branded spending which measures total card usage continued to rise. In market commentary, sources indicated that billed spending grew steadily, driven by travel and entertainment and demand for high-end products. This spending resilience contrasts with weakness in lower-income segments, underscoring a bifurcation in consumer behavior .

AmEx also prudently ramped up its provisions for credit losses to $1.4 billion, up from $1.3 billion a year earlier. This suggests caution regarding potential delinquencies amid economic uncertainty.

Competition in the premium card space is intensifying. Citigroup plans to unveil its Citi Strata Elite card later this quarter, entering a market segment long dominated by AmEx. In response, the company announced an upcoming “largest ever” refresh of its flagship Platinum cards for both consumers and businesses, a sign of its commitment to innovation and premium service.

Despite global economic pressure from high interest rates and trade policy uncertainty, American Express reaffirmed its full-year guidance, projecting 8 to 10 percent revenue growth and EPS between $15.00 and $15.50.

Credit performance metrics remained solid; net write-off rates held around 2.0 percent, slightly improved from 2.1 percent last year. Meanwhile, operating expenses rose driven by marketing, travel benefits, and the ramping up of card refurbishment investments but AmEx’s expense discipline ensured these were well aligned with revenue growth.

This quarter’s strength bolsters a recurring pattern: AmEx historically outperforms during periods of economic strain by focusing on cardholders least likely to reduce spending when belt-tightening becomes widespread.

Analysts applaud AmEx's strategy. St. James’s Place highlighted the return of major global allocators to its stock, attracted by its improved value proposition. M&G Investments described current performance as the early stage of a broader recovery rooted in undervaluation. Barclays cautioned that sterling strength might be inflating results, but overall sentiment is optimistic .

The upcoming roll-out of the new Platinum card design is seen as a statement of intent, aiming to cement AmEx’s dominance in travel and rewards. For investors, key focal points include how these premium enhancements pay off, whether billed business continues climbing, and whether credit risk remains contained.

American Express’s Q2 accomplishment signals more than a successful snapshot—it confirms the viability of its affluent consumer strategy and its ability to drive growth amid uncertainty. As the company positions for both expansion and defense, its results offer a template for high-end financial services in an economy split between cautious and spend-ready consumers.