American Express Likes What It Sees in ‘Wait and See’ Economy

That bet was on full display during the company’s Q2 earnings call Friday (July 18), where the company announced record revenue, a bullish outlook for the rest of the year and a few notes of caution on consumer spending. Chief Financial Officer Christophe Le Caillec told analysts he is watching “significant macro-economic and geopolitical developments” yet sees “remarkable resilience across our customer base,” a view underscored by steady gains in card transactions and low delinquency rates.

Both Le Caillec and CEO Stephen Squeri told the call’s audience that the macroeconomic picture is producing pockets of prudence rather than broad pullbacks. Spending on airlines and lodging — discretionary categories most sensitive to layoffs and shrinking bonus pools — was “softer” in the June quarter, while restaurant and everyday goods purchases held firm. That split tracks with government data as well as PYMNTS Intelligence data showing consumers trading splashy vacations for closer-to-home experiences and necessities.

One variable Amex is tracking but not yet feeling is the expanding tariff talk on Capitol Hill and in the media. In its earnings release the company again cited “announced or future tariff increases” as a risk that could crimp cardmember confidence. Le Caillec said no meaningful impact showed up in second-quarter results, but he cautioned that higher import costs could trickle into everyday prices later this year, potentially leaned on by small business customers who rely on Amex working capital lines.

“We’ve led the premium card category for over 40 years,” Squeri told investors. “The basis of competition has shifted … away from cash-back and no-fee products and toward partner-driven value, access, experiences and superior customer service — where we excel.”

Among the earnings results American Express reported Friday:

• Cardmember spending hit a quarterly record, up 7% from a year earlier, even after stripping out currency swings.
• Goods and services volume — more mundane purchases that act as a real-time read on household budgets — now accounts for more than 70% of billed business and grew at a mid-single-digit pace.
• Millennials spent 10% more and Gen Z nearly 40% more, signaling that younger cardholders are embracing annual-fee products despite a shakier job market for entry-level positions.

On the credit side, write-offs fell to 2.0% from 2.1% a year ago and remain roughly 40% better than industry averages for the millennial and Gen Z cohorts. That’s evidence, Squeri said, that premium cards paired with higher underwriting standards are “widening the gap between our credit metrics and the rest of the industry.”

Revenue rose 9% to a record $17.9 billion, powered by fee income from premium cards and higher net interest revenue on revolving loans. Net income slipped 4% to $2.9 billion, as Amex continued to pour money into technology and risk management systems ahead of its fall makeover of the U.S. consumer and business Platinum cards, which are the core of its premium strategy. The company reaffirmed its full-year outlook for revenue growth of 8% to 10% and earnings per share of $15 to $15.50.

Other takeaways:

• Platinum refresh: Scheduled for this fall; management signaled richer travel and lifestyle benefits, with fees adjusted only at cardholders’ renewal dates. Expenses hit first; higher fee revenue phases in.
• Fed stress test bragging rights: American Express logged the lowest projected credit card loss rate and highest return on assets among banks in this year’s Comprehensive Capital Analysis and Review, keeping its stress-capital buffer at the minimum 2.5%.
• Coinbase partnership: A new Coinbase One card launches on the Amex network, giving crypto enthusiasts rewards in digital assets and positioning the issuer as an “off-ramp” for stablecoin transactions that could one day rival ACH and wire transfers for cross-border payments.
• International runway: Double-digit growth continues outside the United States, with management citing “millions” of new merchant locations and premium annual fees often higher than domestic counterparts.

American Express is threading the needle between caution and conviction. Consumers are still pulling out their cards — particularly fee-heavy premium cards — even as economic clouds gather. That combination of resilient spending, tight credit control and product reinvestment lets the company keep its growth targets intact. If tariffs or a harder downturn do bite, Amex will test whether its premium-for-value formula can keep cardholders swiping through the storm.