Amex's $895 Gamble Pays Off as Platinum Holders Stay Put

Amex's $895 Gamble Pays Off as Platinum Holders Stay Put

Profits jump 28% on a record quarter

American Express reported third-quarter net income of $3.71 billion on October 23, up 28% from a year earlier, with diluted earnings per share of $5.42, up 31%. Stripping out a one-time gain from the sale of its stake in Global Business Travel Group, adjusted earnings were $4.68 a share, up 13% and ahead of the roughly $4.48 consensus, according to Quartz and the Associated Press.

The $200 fee hike that customers swallowed

Last year Amex raised the Platinum Card's annual fee from $695 to $895 — a $200 jump — bundled with new perks. Reviews were broadly positive, but Wall Street's open question was whether even affluent cardholders would stomach the increase. Per ABC News, Amex says nearly all customers moved onto the higher fee so far have kept the card, and net card fee income rose by more than $400 million.

Record revenue as spending and fees climb together

Total revenue net of interest expense hit a record $20.1 billion, up 9% year over year, driven by higher cardmember spending, growth in net interest income on larger card balances, and strong card fee growth, Proactive Investors reports. The figure came in about $20 million shy of the $20.12 billion consensus — essentially in line, according to Investing.com.

Affluent cardholders keep swiping for travel and dining

Billed business — total spending across Amex-issued cards — grew 8% to $454 billion, Investing.com reports. Travel and entertainment spending rose 10%, led by a 13% surge in airline spending and a 9% gain at restaurants, according to TipRanks, while net interest income grew 10% on 8% balance growth.

Squeri cites momentum, retention and credit quality

"Business momentum continues, with strength in billings, new acquisitions and Card Member retention, and excellent credit quality," CEO Stephen Squeri said in a statement carried by Reuters. He added that the company delivered 9% revenue growth and adjusted EPS of $4.68, calling it another strong quarter.

Guidance raised, but so are expenses

Amex lifted full-year 2026 GAAP earnings guidance to $18.30–$18.60 a share from $17.30–$17.90, and adjusted guidance to $17.60–$17.90 from a $17.30 lower bound, while reaffirming its 10% full-year revenue growth target. Zacks notes the company ended the quarter with $43.2 billion in cash and $310.3 billion in total assets. Costs are climbing too: total expenses reached $14.5 billion, up 9%, per Proactive Investors.

Two tests ahead: holiday spending and renewals

The biggest overhang — that the higher fee would chase customers away — has cleared. Next come two tests: whether the 8% spending growth holds through the holiday season, and whether retention stays high as more existing cardholders hit renewal dates at the $895 rate. If both hold, the raised guidance could still prove conservative; if spending cools, the premium-card strategy faces its first real test.