American Express Q2 Earnings: Mixed Earnings, Card Member Spending Growth and More

American Express Co AXP stock is trading lower after it reported Q2 revenue (net of interest expense) growth of 12% year-on-year to $15.05 billion, missing the consensus of $15.48 billion.

Card Member spending hit another all-time high, growing 8% on an FX-adjusted basis, driven by double-digit U.S. Consumer and International Card Member spending growth. Total Network Volumes grew 8% Y/Y to $426.6 billion.

U.S. Consumer Services revenue was $6.9 billion, up 17% Y/Y. Commercial Services revenue was $3.7 billion, up 7% Y/Y.

International Card Services revenue was $2.6 billion, up 10% Y/Y. Global Merchant and Network Services revenue was $1.9 billion, up 14% Y/Y.

Total expenses rose 7% Y/Y to $11.1 billion due to higher customer engagement costs. EPS of $2.89 beat the consensus of $2.81.

Provision for credit losses stood at $1.2 billion, compared with $410 million a year ago, reflecting higher net write-offs and a net reserve build of $327 million. 

"We delivered our fifth straight quarter of record revenues and achieved record earnings per share this quarter, each growing 12 percent over the prior year, demonstrating the continued strength of our differentiated business model," said Stephen J. Squeri, Chairman and Chief Executive Officer.

FY23 Outlook: American Express reaffirmed guidance for revenue growth of 15% - 17% (consensus of $61.57 billion) and EPS of $11.00 - $11.40 (consensus of $11.11).

Price Action: AXP shares are trading lower by 4.07% at $169.90 premarket on the last check Friday.

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