Amex Surpasses Profit Estimate As Spending Rises

American Express exceeded expectations for first-quarter profit due to robust spending by affluent consumers.

The credit card lender observed an 8% increase in spending by its US consumers compared to the previous year, while international consumer spending surged by 14%. I Photo: American Express Facebook

However, executives highlighted the necessity to refocus on US small business customers, where growth has been relatively subdued recently, according to a report by Mehnaz Yasmin and Niket Nishant for Reuters.

The credit card lender observed an 8% increase in spending by its US consumers compared to the previous year, while international consumer spending surged by 14%.

Spending by US small and medium-sized enterprises (SMEs) experienced a more modest uptick of 1%.

CEO Stephen Squeri remarked, "You're seeing some softness in SME. As SME comes back, which we look (at) as an opportunity down the road, that will drive some stronger spending."

Despite the subdued SME spending, analysts praised the company's focus on high-income clientele, which has shielded it from the economic turbulence affecting its peers.

William Blair analyst Cristopher Kennedy noted, "Over the years, AmEx has narrowed its focus to the premium consumer and SMEs, has expanded its network, and remains keenly focused on improving its value proposition."