American Express Platinum card boom lifts spending growth to three-year high
Amex reported 10% revenue growth and raised its revenue outlook as Platinum perks helped drive its fastest spending gains in three years.
By Sal Moretti · Money Reporter
2 min read
American Express Platinum card demand helped push cardmember spending to its fastest growth in three years, MarketWatch reported, as the company put more muscle behind premium rewards and younger customers in its latest quarter.
The Platinum card portfolio is now the fastest-growing franchise across American Express, according to MarketWatch. The card carries an $895 annual fee, and Amex has recently updated its benefits package with perks including a quarterly Lululemon credit and $200 a year toward an Oura Ring.
Christophe Le Caillec, American Express’s chief financial officer, told MarketWatch that the card’s appeal is tied to benefits that go beyond standard points. Cardholders can get help moving through airport security and access dedicated member presales for concert tickets, according to the report.
“It’s really about access,” Le Caillec told MarketWatch.
Why is the American Express Platinum card growing?
American Express has been investing in premium customers, and MarketWatch reported that those efforts are showing up in Platinum demand. The company’s refreshed benefits are aimed at cardholders who value travel, retail and event access enough to pay a high annual fee.
Younger customers are also playing a big role. Le Caillec told MarketWatch that roughly two-thirds of new Platinum and Gold cardholders are millennials or members of Gen Z, a mix he said gives the company confidence about its future.
American Express reported Friday that second-quarter revenue rose 10% to $19.64 billion. The company also lifted its full-year revenue outlook to 10% growth, up from its prior forecast of 9% to 10%.
On spending, the numbers were lively. After adjusting for currency, cardmember spending climbed 9%, which American Express said was its strongest growth on that measure in three years. U.S. cardmembers increased spending by 11.4%.
The company also pointed to strength in everyday categories. Retail spending rose 13% in the second quarter, while restaurant spending increased 10%, according to MarketWatch.
Profit topped Wall Street’s expectations. American Express reported earnings of $4.53 a share, ahead of the $4.40 FactSet consensus cited by MarketWatch. Earnings per share were up 11% from the same period a year earlier.
American Express did not raise its full-year profit forecast. The company said it plans to put some of the recent upside back into the business, including marketing, according to MarketWatch.
Le Caillec told MarketWatch he was “very confident” that the added spending would produce strong returns. Investors still showed some caution, with American Express shares down about 2% in premarket trading after the results.
This story draws on original reporting from MarketWatch.