NEW YORK (AP) — American Express saw its profits surge last quarter by 70%, the company said Friday, as Americans and companies pulled out their cards to start traveling, dining out and entertaining as they had done before the pandemic.
The New York-based company said it earned $1.83 billion last quarter, or $2.27 a share, compared with a profit of $1.07 billion, or $1.30 per share, in the same period a year ago. The results were significantly better than what Wall Street analysts had been expecting.
AmEx attributed the surge in profit to cardmember spending, which the company said jumped to a record high in the third quarter. AmEx earns most of its revenue from the fees it charges merchants to accept its cards, and the more money spent on its network, the higher the company's profits tend to be.
AmEx cardmembers spent $330.7 billion on their cards, an average of $5,771 per card issued, up from $225.5 billion on its network in the same period last year.
The pandemic had a unique impact on AmEx. While the company did not have significant defaults or losses from companies or consumers, spending on its cards dropped sharply as consumers were unable to dine out, travel or go see movies and shows. It required AmEx to look for new ways to get customers to use their cards, or at the very least, not cut up their cards.
That has now mostly abated. There have been multiple signs in the broader economy that consumers — w