Summary
American Express Company reported strong financial results for the third quarter of 2023, with total revenues net of interest expense increasing by 13% to $15.4 billion and diluted earnings per share rising 34% to $3.30 compared to the prior year period. This performance was driven by robust Card Member spending, with worldwide network volumes up 7%, particularly in Travel & Entertainment (T&E) spend which saw a 13% increase. The company also experienced significant growth in net interest income, up 34%, largely due to higher interest rates and an increase in the interest-bearing portion of Card Member loans. Despite an increase in provisions for credit losses, driven by higher net write-offs and loan growth, the company highlighted that net write-off and delinquency rates remained best-in-class, reflecting the strength of its premium customer base and risk management. American Express continued to return capital to shareholders, deploying $1.7 billion in the quarter through dividends and share repurchases, while maintaining its Common Equity Tier 1 capital ratio within its target range. Management expressed confidence in its business model and strategy for sustainable long-term growth, despite acknowledging macroeconomic uncertainties.
Financial Highlights
39 data points| Revenue | $9.38B |
| Interest Expense | $1.80B |
| Net Income | $2.45B |
| EPS (Basic) | $3.30 |
| EPS (Diluted) | $3.30 |
| Shares Outstanding (Basic) | 732.00M |
| Shares Outstanding (Diluted) | 733.00M |
Key Highlights
- 1Total revenues net of interest expense grew 13% year-over-year to $15.4 billion for the third quarter.
- 2Diluted earnings per share increased 34% to $3.30, significantly exceeding the prior year's $2.47.
- 3Worldwide network volumes rose 7% to $420.2 billion, with Travel & Entertainment spend showing a strong 13% increase.
- 4Net interest income saw a substantial 34% increase, driven by higher interest rates and growth in Card Member loan balances.
- 5Provisions for credit losses increased by 58% to $1.2 billion, primarily due to higher net write-offs and increased loan volumes, though delinquency and write-off rates remain strong.
- 6The company returned $1.7 billion to shareholders through dividends and share repurchases during the quarter.
- 7Common Equity Tier 1 capital ratio remained strong at 10.7%, within the company's target range.