American Express Profits Surge. What Does It Reveal About the Economy?

American consumers are still spending billions on travel, restaurants, and everyday purchases, and American Express is benefiting.

The financial services company announced Friday, October 23, that its third-quarter profit increased 28% from a year earlier to $3.71 billion, while revenue reached a record $20.1 billion.

Total spending on American Express-issued cards climbed 8% to $454 billion, reflecting continued demand among the company's largely affluent customer base.

The performance encouraged American Express to raise its full-year earnings outlook, signaling confidence in its business as economic uncertainty continues.

But the results reveal something more interesting than another profitable quarter for a major financial institution.

American Express is demonstrating how consumer spending, premium services, customer loyalty, and financial stability are reshaping the American economy.

A $454 Billion Signal From American Consumers

American Express reported that cardholders spent $454 billion during the third quarter, compared with approximately $421 billion a year earlier.

That $33 billion increase represents substantial additional spending passing through the company's payment network.

Revenue, excluding interest expense, grew 9%, while adjusted earnings per share climbed 13% to $4.68.

The company now expects adjusted earnings of $17.60 to $17.90 per share for 2026, raising the lower end of its previous forecast.

Its reported earnings outlook also increased to $18.30–$18.60 per share, reflecting a one-time gain associated with the sale of an investment, partially offset by restructuring charges.

The difference matters because adjusted earnings provide a clearer view of recurring business performance.

Chief Executive Stephen Squeri credited the results to stronger spending, customer acquisition, retention, and credit quality.

The central question is what these numbers reveal about the broader economy.

If consumers are concerned about prices and borrowing costs, why are some still spending aggressively?

Part of the answer lies in who holds American Express cards.

Why Wealthier Consumers Are Spending More

American Express has built much of its business around customers with strong credit histories, substantial disposable income, and an appetite for premium services.

That positioning gives the company a different view of consumer activity than retailers or lenders serving a broader income distribution.

During the third quarter, travel and entertainment spending increased 10%.

Airline spending rose 13%, while restaurant spending climbed 9%.

These categories are especially revealing because they involve purchases that households can often postpone when financial pressures increase.

Their continued growth suggests that many affluent consumers remain willing to spend on convenience, experiences, and lifestyle services.

The company also reported that average customer spending reached $6,735 during the quarter, approximately 5% higher than a year earlier.

However, increased spending does not necessarily mean consumers purchased 5% more goods or services.

Higher airline fares and other price increases accounted for part of the growth, according to Chief Financial Officer Christophe Le Caillec.

American Express also reported increased transaction activity.

That distinction is important: spending can rise because customers purchase more, because prices increase, or because both happen simultaneously.

The Premium Credit Card Strategy Is Working

One of the most interesting developments involves American Express's Platinum Card.

Last year, the company increased the card's annual membership fee from $695 to $895 while introducing additional benefits.

A $200 increase is significant, particularly in a competitive market where customers can choose from numerous credit card providers.

Yet American Express reports that nearly all customers transitioned to the updated card have retained their memberships.

Net card fees increased by more than $400 million compared with the previous year.

This demonstrates the strength of the company's premium membership strategy.

Rather than competing primarily on the lowest price, American Express focuses on customers who believe its rewards, travel benefits, services, and brand experience justify a higher fee.

The broader business lesson applies well beyond banking.

Companies that consistently deliver value and maintain strong customer relationships can sometimes command higher prices without losing their core audience.

For American entrepreneurs, this highlights the importance of differentiation.

Competing solely on price is one strategy. Building a product or service customers consider difficult to replace is another.

What the Results Mean for Restaurants and Travel Businesses

Consumer spending is not simply a banking statistic.

When cardholders purchase airline tickets, reserve hotels, or dine at restaurants, that activity supports businesses and employment across multiple industries.

Travel spending creates demand for transportation, hospitality, entertainment, and related services.

Restaurant spending supports food suppliers, servers, kitchen employees, delivery networks, and property owners.

Small businesses can participate in these economic networks, particularly when they serve customers seeking specialized experiences or higher-quality services.

American Express's performance suggests that affluent consumer demand remains an important source of activity for many businesses.

However, its results should not be interpreted as evidence that every American household enjoys the same financial flexibility.

A family managing rising insurance premiums, housing expenses, and grocery bills may make very different spending decisions from a household with substantial savings and investment income.

This difference helps explain why strong corporate earnings and financial pressure on ordinary families can exist simultaneously.

Strong Profits, but a Leaner Workforce

The company's results also reveal an important development in corporate operations.

American Express disclosed that it eliminated approximately 4,000 positions, representing about 5% of its workforce, during the third quarter.

Squeri described the reductions as an efficiency initiative rather than a response to weakening business conditions.

The cuts come as major financial institutions invest in technology, automated processes, and more efficient operating systems.

For shareholders, such changes can improve profitability.

For affected workers, they represent a significant disruption.

This distinction illustrates another feature of today's economy: stronger corporate earnings do not automatically translate into employment growth.

The company's credit performance was encouraging. American Express recorded approximately $1 billion in provisions for credit losses, compared with $1.3 billion a year earlier.

Lower provisions suggest its assessment of expected credit losses has improved, consistent with a customer base that continues demonstrating financial resilience.

What American Express Reveals About America's Future

American Express's latest performance offers a useful perspective on consumer behavior in 2026.

Premium customers continue spending. Travel and dining remain strong. Customer loyalty is supporting higher membership revenue, and credit conditions appear manageable within the company's portfolio.

At the same time, inflation influences spending totals, and corporate efficiency measures are changing employment.

The most important conclusion is not that the entire economy is booming or struggling.

It is that different parts of the economy are performing differently.

For business owners, understanding their customers' financial circumstances, spending priorities, and expectations is becoming increasingly valuable.

For American families, purchasing power remains the measure that matters most.

And for the country's economic future, sustainable growth will depend on expanding opportunities beyond the consumers who already possess the greatest financial flexibility.

American Express's record quarter shows that Americans are still willing to spend when they see value. The greater economic opportunity is building an economy where more families have the financial strength to participate in that prosperity.