American Express (NYSE: AXP) delivered another quarter of double-digit revenue growth and stronger-than-expected earnings, but investors apparently wanted more.
Shares of the credit card giant are dropping after the company reported second-quarter results that topped Wall Street’s profit expectations but came in just shy of revenue estimates. Despite the stock’s decline, the report painted a picture of a company continuing to benefit from healthy customer spending, stable credit quality, and strong demand for its premium card products. American Express also raised its full-year revenue growth forecast after posting better-than-expected results during the first half of the year.
Earnings Beat, Revenue Falls Just Short
American Express reported second-quarter earnings of $4.53 a share, topping analysts’ consensus estimate of $4.40.
Revenue was up 10% from a year earlier to $19.64 billion. While that marked another quarter of solid growth, it narrowly missed Wall Street’s expectations of $19.69 billion. Net income climbed to $3.1 billion from $2.9 billion in the same quarter last year, reflecting continued momentum across the company’s consumer and commercial businesses. American Express said the revenue increase was fueled by higher Card Member spending, stronger net interest income as card balances increased, and continued growth in card fee revenue.
Consumers Keep Spending
American Express continues to see healthy spending among its customer base.
Card Member spending increased 9% from a year earlier, marking the strongest growth rate the company has reported in three years. That suggests that higher-income consumers remain willing to spend despite elevated interest rates and broader economic uncertainty.
Chairman and Chief Executive Stephen Squeri highlighted the strength of consumer activity when discussing the results. “We had another excellent quarter, with 10 percent revenue growth, EPS of $4.53, and Card Member spending growth of 9 percent, the highest rate we’ve seen in three years on an FX-adjusted basis.”
Outlook Gets a Lift
One of the biggest positives from the report was management’s increased confidence in the company’s growth outlook. Following stronger-than-expected performance during the first six months of the year, American Express raised its forecast for full-year revenue growth to 10%.
The company maintained its earnings guidance of $17.30 to $17.90 per share, indicating it remains confident in its ability to deliver strong profitability while continuing to invest in the business. “Based on our better-than-expected performance in the first half of the year, we are raising our full-year revenue growth guidance to 10 percent,” Squeri added.
Expanding Beyond Payments
American Express also announced a strategic acquisition alongside its earnings release.
The company plans to acquire TheFork, a European restaurant reservation platform that connects diners with approximately 50,000 restaurants across 11 countries.
The acquisition would expand American Express’s dining and lifestyle offerings, an area the company has increasingly emphasized as it seeks to deepen customer engagement beyond traditional payments.
American Express: The Bottom Line
While the post-earnings drop may suggest disappointment, the underlying results were largely positive. American Express continues to post double-digit revenue growth, earnings remain strong, customer spending is accelerating, and credit quality has held up well.
The company’s decision to raise its revenue outlook also points to confidence that those trends will continue. Still, after years of consistently strong execution, expectations for American Express remain high.
For long-term investors, the quarter reinforced the company’s strengths: a resilient customer base, stable credit performance, expanding premium offerings, and management confident enough to lift its revenue forecast while continuing to invest for future growth.
