American Express reports resilient Q2 2025 results, reaffirming guidance on strong fee-based growth

Overview

American Express posted solid results for the second quarter of 2025, driven by strong growth in premium card fees, expanding spending across customer generations, and disciplined execution. Despite a tough comparison due to a one-time gain in the prior year, adjusted profitability remained strong, with the company reaffirming its full-year outlook.

“Our business remains strong and diversified across regions and segments.” We are seeing powerful momentum from younger customer cohorts and continued demand for our premium products, which positions us well for sustained long-term growth”, said Chairman and CEO Stephen J. Squeri.

Q2 2025 vs. Q2 2024:

Total revenues net of interest expense rose to $17.86bn (+9% YoY), supported by strength in card fees, discount revenue, and interest income.
- Discount revenue rose by 6%, driven by increased transaction volume across global markets.
- Net card fees surged +20%, as premium product penetration continued and cardholder retention remained high.
- Service fees and other revenues increased 8%, reflecting higher loyalty-related revenue and foreign exchange services.
Net interest income grew 12%, as revolving loan balances increased, partially offset by lower average interest rates.
Net income declined slightly to $2.89bn (-4% YoY), reflecting a prior-year gain from the sale of Accertify.
Diluted EPS (GAAP) was $4.08, compared to $4.15 in Q2 2024. However, adjusted EPS (non-GAAP) excluding that gain grew by 17% YoY, showing strong underlying profitability.
Total billed business (on an FX-adjusted basis) increased by +7% YoY, including:
- Goods & Services (G&S): +7% YoY; Travel & Entertainment (T&E): +5% YoY, despite leap year calendar impacts.
U.S. Consumer billed business rose +7%, led by:
- +39% growth from Gen Z cardmembers;
- +10% from Millennials and +6% from Gen X.
Commercial Services posted a +2% YoY increase, with strength in small business and corporate clients offset by caution in select sectors.
International Card Services delivered +12% YoY growth, fueled by G&S (+14%) and T&E (+8%).
Total expenses reached $12.9bn (+14% YoY), driven by:
- Operating expenses, up +28%, reflecting the absence of the Accertify gain and higher vendor services.
- Card Member services rose 13%, due to increased usage of travel and lifestyle benefits.
- Rewards costs climbed 9%, linked to elevated redemption volumes and shifts in redemption mix.
- Business development spending grew 11%, with stronger partner incentives aligned with higher billed business.
- Marketing expenses rose 5%, focused on Gen Z and Millennial acquisition.
- Salaries and benefits increased 10%, tied to compensation programs and retention.
Provisions for credit losses rose to $1.41bn, mainly due to higher reserve builds and modestly increased charge-offs.
CET1 ratio remained strong at 10.6%, well above regulatory thresholds.
Liquidity was solid, with $209bn in liabilities, of which 71% were deposits.
In Q2, American Express returned $2.5bn to shareholders: $1.4bn through share repurchases and $1.1bn in dividends.

Looking ahead, American Express reaffirmed its guidance for the full year 2025, supported by strong momentum in premium card acquisition, rising customer engagement, and resilient spending patterns across key segments. The company expects total revenue growth in the range of 8% to 10%, driven by continued expansion in fee-based products, strong demand for travel and lifestyle benefits, and ongoing investments in younger customer segments such as Gen Z and Millennials. Adjusted earnings per share (EPS) are projected to be between $15.00 and $15.50, representing an increase of 12% to 16% YoY when excluding the one-time Accertify gain recorded in 2024. This reaffirmation reflects American Express’s confidence in its long-term strategy and its ability to deliver sustainable, profitable growth despite a dynamic macroeconomic environment.

From a technical analysis perspective, American Express shares have shown moderate downside pressure following the recent earnings release, with the price closing down 2.35%. Despite the pullback, the stock remains above both its 50-day and 200-day simple moving averages, indicating that the broader uptrend remains intact. The RSI has declined to 47.58, down from recent overbought levels above 70 earlier in July. This signals that bullish momentum is weakening, and the stock is now trading in a more neutral zone, potentially setting up for consolidation or a bounce if support levels hold. While short-term sentiment appears cautious following the post-earnings dip, longer-term technicals remain constructive, with support likely near the 50-day SMA and investor focus shifting to guidance execution in H2.