Credit card giant American Express on Friday (Oct 20) reported third-quarter profit that beat expectations, helped by resilient spending from its wealthy customers who shrugged off concerns about an economic downturn.

AmEx, which caters to a premium customer base, has largely been able to mitigate the hit from inflation and the Federal Reserve’s rate hikes, which have made borrowing costly and reined in discretionary spending.

“Travel and Entertainment (T&E) spending remained robust... Restaurant spending was again one of our fastest-growing T&E categories,” CEO Stephen Squeri said in a statement.

The company reported a profit of US$2.45 billion, or US$3.30 per share, up from US$1.88 billion or US$2.47 per share a year earlier. On average, analysts had expected a profit of US$2.94 per share, according to LSEG IBES data.

In a sign of caution, however, AmEx boosted its provisions for credit losses to US$1.23 billion, up 58 per cent from last year, to account for the increased likelihood of consumers defaulting on their debt.

Revenue, net of interest expense, surged 13 per cent, to US$15.38 billion. REUTERS

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