AmEx profits surge 13% as affluent customers splurge on luxury goods and travel

Core Insights - American Express reported a 13% increase in profits for the fourth quarter, driven by strong spending from affluent customers on luxury goods, dining, and travel [1] Financial Performance - The company earned a profit of $2.46 billion, or $3.53 per share, compared to $2.17 billion, or $3.04 per share, in the same period last year, aligning with analysts' forecasts [2] - Cardmembers spent $506.2 billion on their cards in the fourth quarter, an increase from $464 billion year-over-year, averaging $6,696 per card member [4] Customer Engagement and Strategy - American Express continues to incentivize spending through perks and rewards, including a recent refresh of the Platinum Card that added a $400 annual dining credit while increasing the annual fee to $895 [3] - The company is successfully attracting younger customers, with Gen-Z and Millennials now spending more on AmEx cards than Gen-X, which has historically been the largest spending group [5] Future Outlook - American Express provided a forecast for 2026, expecting earnings per share to be between $17.30 and $17.90, and plans to increase the quarterly dividend from 82 cents to 95 cents per share [5]