AMERICAN EXPRESS CO
For the period ended Jun 30, 2024. Filed Jul 19, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Jul 19, 2024
AXP$320.99-1.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-04-19.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A)Current report: 10-Q
Period ended 2024-06-30; filed 2024-07-19.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A)The baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 315 previous paragraphs and 313 current paragraphs.
192 unchanged; 86 reworded; 33 added; 33 removed; 4 previous and 2 current paragraphs rearranged.
Tables are not compared: 22 previous and 22 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (33)
Current report
Our results for the second quarter reflect the earnings power of our business model, driven by our premium, high credit-quality customer base, as well as the greater scale and operating leverage we have achieved over the last several years and the ongoing success of our strategic investments to enhance our Membership Model. We continued to see solid momentum across the business, with stable growth in billings, strong new card acquisitions and excellent credit performance. Our second quarter results also reflect the sale of Accertify Inc. (Accertify), which closed on May 1, 2024, and resulted in a gain of $531 million ($479 million after tax; $0.66 per share). Net income for the quarter was $3.0 billion, or $4.15 per share, compared with net income of $2.2 billion, or $2.89 per share, a year ago.
Current report
Operating expenses decreased 13 percent, primarily reflecting the gain recognized on the sale of Accertify, partially offset by higher compensation costs to support business growth. Excluding the Accertify gain, operating expenses grew at a slower pace than revenue growth, reflecting continued operating expense discipline. These operating expense efficiencies demonstrate the earnings power of our core business that enables us to invest in growth initiatives at elevated levels. We remain focused on driving marketing and operating expense efficiencies over time.
Current report
Discount revenue increased for both the three and six month periods, primarily driven by increases in billed business of 5 percent and 6 percent, respectively. See Tables 5 and 6 for more details on billed business performance.
Current report
Card Member loans provision for credit losses increased for both the three and six month periods, primarily due to higher net write-offs, partially offset by lower reserve builds in the current periods. The reserve builds in the current periods were primarily driven by increases in loans outstanding, partially offset, for the three month period, by lower delinquencies. The reserve builds in the prior periods were primarily driven by increases in loans outstanding and, for the six month prior period, higher delinquencies.
Current report
Card Member receivables provision for credit losses decreased for both the three and six month periods, primarily due to lower net write-offs, partially offset by reserve builds in the current periods versus reserve releases in the prior periods. The reserve build in the current three month period was primarily driven by an increase in receivables outstanding for U.S. consumer and U.S. small business customers. The reserve releases in the prior periods were primarily driven by lower delinquencies, partially offset by increases in receivables outstanding.
Current report
Other provision for credit losses increased for the three month period, primarily due to higher net write-offs and a higher reserve build in the current period. Other provision for credit losses increased for the six month period, primarily due to higher net write-offs, partially offset by a lower reserve build in the current period. The reserve builds in the current periods were primarily driven by a reserve related to amounts due from a merchant in bankruptcy, as well as increases in non-card loans outstanding. The reserve builds in the prior periods were primarily driven by increases in non-card loans outstanding.
Current report
Other expenses decreased for both the three and six month periods, primarily driven by the gain recognized on the sale of Accertify and net gains on Amex Ventures investments, partially offset by increases in professional services expenses.
Current report
Net card fees increased 17 percent and 16 percent for the three and six month periods, respectively, primarily driven by growth in our premium card portfolios.
Current report
Card Member loans provision for credit losses increased for both the three and six month periods, primarily due to higher net write-offs, partially offset by lower reserve builds in the current periods. The reserve builds in the current periods were primarily driven by increases in loans outstanding, partially offset by lower delinquencies. The reserve builds in the prior periods were primarily driven by increases in loans outstanding and, for the prior six month period, by higher delinquencies.
Current report
Card Member receivables provision for credit losses increased for both the three and six month periods, primarily due to reserve builds in the current periods, versus reserve releases in the prior periods, and, for the six month period, higher net write-offs. The reserve build in the current three month period was primarily driven by an increase in receivables outstanding. The reserve releases in the prior periods were primarily driven by lower delinquencies, partially offset by increases in receivables outstanding.
Current report
Business development expense increased for both the three and six month periods, primarily due to increased partner payments driven by higher billed business.
Current report
Non-interest revenues increased for both the three and six month periods, primarily driven by higher Discount revenue and Net card fees.
Current report
Net card fees increased 11 percent and 12 percent for the three and six month periods, respectively, primarily driven by growth in our premium card portfolios.
Current report
Card Member loans provision for credit losses for the three month period remained largely in line with the prior period, as the lower reserve build in the current period was offset by higher net write-offs. Card Member loans provision for credit losses increased for the six month period, primarily due to higher net write-offs, partially offset by a lower reserve build in the current period. The reserve builds in both current periods were primarily driven by increases in loans outstanding, partially offset for the current three month period by lower delinquencies. The reserve builds in the prior periods were primarily driven by increases in loans outstanding and, for the prior six month period, higher delinquencies.
Current report
Card Member receivables provision for credit losses increased for the three month period, primarily due to a reserve build in the current period, versus a reserve release in the prior period, partially offset by lower net write-offs. Card Member receivables provision for credit losses decreased for the six month period, primarily due to lower net write-offs, partially offset by a reserve build in the current period, versus a reserve release in the prior period. The reserve build in the current three month period was primarily driven by an increase in receivables outstanding for U.S. small business customers. The reserve releases in the prior periods were primarily driven by lower delinquencies, partially offset by increases in receivables outstanding.
Current report
Total expenses increased for the three month period and were flat for the six month period. The increase in the three month period was primarily driven by higher Marketing expense, partially offset by a decrease in Operating expenses.
Current report
Non-interest revenues increased for both the three and six month periods, primarily driven by higher Discount revenue and Net card fees.
Current report
Total expenses increased for both the three and six month periods, primarily driven by higher Card Member rewards and Card Member services expenses.
Current report
Card Member rewards expense increased for both the three and six month periods, primarily driven by higher billed business.
Current report
Business development expense increased for the three month period and decreased for the six month period. The increase in both periods was primarily due to increased partner payments driven by higher billed business, which was more than offset in the six month period by a prior-year charge related to revenue allocated to a joint venture partner.
Current report
Salaries and employee benefits and other expenses were flat for both the three and six month periods. The three month period was primarily driven by a decrease in allocated service costs, offset by higher compensation costs. The six month period was primarily driven by an increase in allocated service costs and technology expense, offset by a decrease in compensation costs.
Current report
Discount revenue increased 2 percent and 3 percent for the three and six month periods, respectively, primarily driven by increases in billed business. See Tables 5 and 6 for more details on billed business performance.
Current report
Processed revenue decreased 6 percent and 5 percent for the three and six month periods, respectively, and was flat for both periods on an FX-adjusted basis.3
Current report
Other provision for credit losses increased for both the three and six month periods, primarily due to higher reserve builds in the current periods driven by a reserve related to amounts due from a merchant in bankruptcy.
Current report
Total expenses decreased for both the three and six month periods, primarily driven by lower Operating expenses.
Current report
Salaries and employee benefits and other expenses decreased for both the three and six month periods, primarily driven by the gain recognized on the sale of Accertify included in the Other, net component of operating expenses, partially offset by increases in allocated service costs.
Current report
Corporate & Other pretax loss was $502 million and $445 million for the three months ended June 30, 2024 and 2023, respectively, and $1.1 billion for both the six months ended June 30, 2024 and 2023. The increase in the pretax loss for the three month period was primarily driven by higher incentive compensation, partially offset by net gains on Amex Ventures investments. Higher incentive compensation in the six month period was wholly offset by net gains on Amex Ventures investments.
Current report
As discussed above, we will become a Category III firm in the third quarter of 2024 and thus will become subject to a CET1 countercyclical capital buffer requirement (if enacted by the Federal Reserve) and a minimum supplementary leverage ratio, among other requirements. See the “Supervision and Regulation — Capital and Liquidity Regulation” section of the 2023 Form 10-K for more information.
Current report
Resolution Planning
Current report
On June 20, 2024, the FDIC issued a final rule amending its resolution plan requirements for insured depository institutions. The final rule requires insured depository institutions with $100 billion or more in assets that are not affiliated with U.S. global systematically important banking organizations, including AENB, to submit full resolution plans every three years with interim supplements in non-submission years. Under the final rule, resolution plans are subject to more stringent standards with respect to their assumptions and content, as well as enhanced credibility standards for the FDIC’s evaluation of resolution plans and expanded expectations regarding engagement and capabilities testing. The final rule is effective on October 1, 2024, and provides that the due date for the first resolution plan or interim supplement for insured depository institutions such as AENB will be no earlier than June 30, 2025.
Current report
Recently Issued Accounting Standards
Current report
Proprietary new cards acquired — Represents the number of new cards issued by American Express during the referenced period, net of replacement cards. Proprietary new cards acquired is useful as a measure of the effectiveness of our customer acquisition strategy.
Current report
•the parties’ ability to satisfy the closing conditions for the acquisitions of Tock and Rooam, including receipt of regulatory approvals, and to consummate the transactions; the underlying assumptions related to the transactions proving to be inaccurate or unrealized; and our ability to integrate Tock and Rooam and benefit from and expand the platforms, tools and capabilities, which will depend in part on management’s decisions regarding future operations, strategies and business initiatives;
Removed paragraphs (33)
Previous report
Our results for the first quarter reflect our continued investments in value propositions, marketing, technology capabilities and our brand, which are driving high levels of customer engagement and loyalty. The successful execution of our growth strategy, along with the strength of our premium customer base and differentiated business model, drove net income of $2.4 billion, or $3.33 per share, compared with net income of $1.8 billion, or $2.40 per share, a year ago.
Previous report
As previously announced, we signed an agreement to sell fraud prevention solutions provider Accertify Inc., a wholly owned subsidiary we acquired in 2010, the operations of which are reported within the Global Merchant and Network Services segment. The transaction is subject to customary closing conditions and is expected to close in the second quarter of 2024. Upon closing, we expect to recognize a sizeable pre-tax gain, which will be recorded as a reduction to Other expense and is expected to be substantially reinvested back into our business.
Previous report
Discount revenue increased, primarily driven by an increase in billed business of 6 percent. See Tables 5 and 6 for more details on billed business performance.
Previous report
Provisions for Credit Losses
Previous report
Card Member loans provision for credit losses increased, primarily due to higher net write-offs, partially offset by a lower reserve build in the current period. The reserve build in the current period was primarily driven by an increase in loans outstanding and slightly higher delinquencies. The reserve build in the prior period was primarily driven by higher delinquencies and an increase in loans outstanding.
Previous report
Other provisions for credit losses increased, primarily due to higher net write-offs, partially offset by a lower reserve build in the current period. The reserve builds in both the current and prior periods were primarily driven by increases in non-card loans outstanding in the respective periods.
Previous report
Expenses
Previous report
Card Member services expense increased, primarily due to growth in premium card accounts and higher usage of travel-related benefits by existing Card Members.
Previous report
Other expenses decreased, primarily driven by net losses on Amex Ventures investments in the prior period.
Previous report
Net card fees increased 16 percent, primarily driven by growth in our premium card portfolios.
Previous report
Card Member loans provision for credit losses increased, primarily due to higher net write-offs, partially offset by a lower reserve build in the current period. The reserve build in the current period was primarily driven by slightly higher delinquencies. The reserve build in the prior period was primarily driven by higher delinquencies and an increase in loans outstanding.
Previous report
Card Member receivables provision for credit losses increased, primarily due to higher net write-offs, partially offset by a higher reserve release in the current period. The reserve releases in both the current and prior periods were primarily driven by decreases in receivables outstanding in the respective periods.
Previous report
Business development expense increased, primarily due to increased partner payments driven by higher billed business and contractual rates.
Previous report
Card Member services expense increased, primarily due to growth in premium card accounts and higher usage of travel-related benefits by existing Card Members.
Previous report
Non-interest revenues increased, primarily driven by higher Discount revenue, Net card fees and Service fees and other revenue.
Previous report
Net card fees increased 12 percent, primarily driven by growth in our premium card portfolios.
Previous report
Card Member loans provision for credit losses increased, primarily due to higher net write-offs, partially offset by a lower reserve build in the current period. The reserve builds in both the current and prior periods were primarily driven by higher delinquencies and increases in loans outstanding in the respective periods.
Previous report
Total expenses decreased, primarily driven by lower Card Member rewards expense, partially offset by higher Marketing and Operating expenses.
Previous report
Card Member services expense increased, primarily due to higher usage of travel-related benefits.
Previous report
Non-interest revenues increased, primarily driven by higher Discount revenue and Net card fees.
Previous report
Card Member receivables provision for credit losses decreased, primarily due to lower net write-offs.
Previous report
Total expenses increased, primarily driven by higher Card Member rewards and Marketing expenses, partially offset by lower Business development expense.
Previous report
Card Member rewards expense increased, primarily driven by higher billed business.
Previous report
Card Member services expense increased, primarily due to higher usage of travel-related benefits.
Previous report
Salaries and employee benefits and other expenses increased, primarily due to an increase in allocated service costs, partially offset by lower compensation costs.
Previous report
Discount revenue increased 4 percent, primarily driven by an increase inbilled business. See Tables 5 and 6 for more details on billed business performance.
Previous report
Processed revenue decreased 4 percent and increased 2 percent on an FX-adjusted basis, primarily driven by an increase in FX-adjusted processed volumes.3
Previous report
Total expenses were relatively flat, primarily driven by lower Business development and Marketing expenses, largely offset by higher Operating expenses.
Previous report
Salaries and employee benefits and other expenses increased, primarily driven by an increase in allocated service expense, higher joint venture related expense, and higher compensation costs.
Previous report
Corporate & Other pretax loss was $615 million and $667 million for the three months ended March 31, 2024 and 2023, respectively. The decrease in pretax loss was primarily driven by net losses on Amex Ventures investments in the prior period, partially offset by higher compensation costs in the current period.
Previous report
In 2023, the net cash provided by financing activities was primarily driven by growth in customer deposits, partially offset by net debt repayments, dividend payments and share repurchases.
Previous report
Recently Adopted and Issued Accounting Standards
Previous report
•changes affecting the expected timing for closing the sale of Accertify Inc., the amount of the potential gain we recognize upon the closing and the portion of such gain management determines to reinvest back into our business, which will depend on regulatory and other approvals, consultation requirements, the execution of ancillary agreements, the cost and availability of financing for the purchaser to fund the transaction and the potential loss of key customers, vendors and other business partners and management’s decisions regarding future operations, strategies and business initiatives;
Reworded paragraphs (86)
Previous wording
American Express is a globally integrated payments company, providing customers with access to products, insights and experiences that enrich lives and build business success. Our principal products and services are credit and charge card products, along with travel and lifestyle related services, offered to consumers and businesses around the world. Our range of products and services includes:
Current wording
American Express is a globally integrated payments company, providing customers with access to products, insights and experiences that enrich lives and build business success. We are a leader in providing credit and charge cards to consumers, small businesses, mid-sized companies and large corporations around the world. Our range of products and services includes:
Previous wording
•Merchant acquisition and processing, servicing and settlement, and point-of-sale marketing and information products and services for merchants
Current wording
•Merchant acquisition and processing, servicing and settlement, fraud prevention, and point-of-sale marketing and information products and services for merchants
Previous wording
•Other fee services, including fraud prevention services and the design and operation of customer loyalty programs
Current wording
•Other fee services, such as the design and operation of customer loyalty programs
Previous wording
Our various products and services are offered globally to diverse customer groups, including consumers, small businesses, mid-sized companies and large corporations. These products and services are offered through various channels, including mobile and online applications, affiliate marketing, customer referral programs, third-party service providers and business partners, direct mail, telephone, in-house sales teams, and direct response advertising.
Current wording
These products and services are offered through various channels, including mobile and online applications, affiliate marketing, customer referral programs, third-party service providers and business partners, direct mail, telephone, in-house sales teams, and direct response advertising.
Previous wording
(a)Represents net income, less (i) earnings allocated to participating share awards of $18 million and $14 million for the three months ended March 31, 2024 and 2023, respectively, and (ii) dividends on preferred shares of $14 million for both the three months ended March 31, 2024 and 2023.
Current wording
(a)Represents net income, less (i) earnings allocated to participating share awards of $23 million and $17 million for the three months ended June 30, 2024 and 2023, respectively, and $41 million and $31 million for the six months ended June 30, 2024 and 2023, respectively, and (ii) dividends on preferred shares of $15 million for both the three months ended June 30, 2024 and 2023, and $29 million for both the six months ended June 30, 2024 and 2023.
Previous wording
Billed business, the most significant driver of our financial results, increased 6 percent year-over-year (7 percent on an FX-adjusted basis), in line with the overall spend environment we have seen the past few quarters.1 U.S. Consumer Services billed business grew by 8 percent year-over-year, reflecting continued strength in spending trends across all generational cohorts, with the largest portion of this growth coming from our Millennial and Gen-Z Card Members. International Card Services billed business grew by 11 percent year-over-year (13 percent on an FX-adjusted basis), driven by continued growth in spend across all regions and customer types outside the United States.1 Commercial Services billed business grew by 2 percent on a year-over-year basis, reflecting continued modest growth from U.S. small and mid-sized enterprise (SME) Card Members.
Current wording
Billed business grew by 5 percent year-over-year (6 percent on an FX-adjusted basis), consistent with the past few quarters, and in line with a slower growth environment.1 G&S grew by 5 percent year-over-year (6 percent on an FX-adjusted basis) and T&E spending grew by 6 percent (7 percent on an FX-adjusted basis), with sequential softening in airline and lodging spend growth, while growth in restaurants, our largest T&E category, remained strong.1 U.S. Consumer Services billed business grew by 6 percent year-over-year, with continued strength in spending by Millennial and Gen-Z Card Members. Commercial Services billed business grew by 2 percent on a year-over-year basis, reflecting continued modest growth from U.S. small and mid-sized enterprise (SME) Card Members. International Card Services billed business grew by 10 percent year-over-year (13 percent on an FX-adjusted basis), driven by continued growth in spend across all regions and customer types outside the United States.1
Previous wording
Total revenues net of interest expense increased 11 percent year-over-year. The growth in billed business drove a 5 percent increase in Discount revenue, our largest revenue line. Net card fees increased 15 percent year-over-year, reflecting high levels of new card acquisition and Card Member retention, as well as our cycle of product refreshes. Net interest income increased 26 percent versus the prior year, primarily reflecting growth in our revolving loan balances, which has moderated over the last several quarters, as well as continued net yield expansion versus the prior year.
Current wording
Total revenues net of interest expense increased 8 percent year-over-year (9 percent on an FX-adjusted basis).1 The growth in billed business drove a 4 percent increase in Discount revenue, our largest revenue line. Net card fees increased 15 percent year-over-year, reflecting high levels of new card acquisition and Card Member retention, as well as our cycle of product refreshes. Net interest income increased 20 percent versus the prior year, primarily reflecting growth in our revolving loan balances, which has moderated over the last several quarters.
Previous wording
Total loans and Card Member receivables increased 12 percent year-over-year, as our Card Members continue to spend and build balances. Provisions for credit losses increased, primarily driven by higher net write-offs, partially offset by a lower net reserve build in the current year. Net write-off and delinquency rates remained best-in-class, supported by our premium global customer base, our strong focus on risk management and disciplined growth strategy.
Current wording
Total loans and Card Member receivables increased 11 percent year-over-year, with growth continuing to moderate sequentially. Provisions for credit losses increased, primarily driven by higher net write-offs, partially offset by a lower reserve build compared to last year. Net write-off and delinquency rates remained best-in-class, supported by our premium global customer base, our strong focus on risk management and disciplined growth strategy.
Previous wording
Card Member rewards, Card Member services and Business development expenses are generally correlated to volumes or are variable based on usage and collectively increased year-over-year primarily due to growth in billed business and premium card accounts, as well as higher usage of travel-related benefits. The year-over-year growth in these variable customer engagement expenses for the quarter was partially offset by a benefit related to enhancements to the models that estimate future redemptions of Membership Rewards points by U.S. Card Members resulting from our periodic evaluation of our liability estimation process and assumptions. Marketing expense increased 10 percent year-over-year, as we continue to invest in acquiring high spending, high quality customers and other growth initiatives. During the quarter we acquired 3.4 million proprietary new cards. Operating expenses were flat year-over-year, reflecting higher compensation costs to support business growth, offset by net losses on Amex Ventures investments in the prior year. We remain focused on driving marketing and operating expense efficiencies over time, while continuing to invest in our growth strategy.
Current wording
Card Member rewards, Card Member services and Business development expenses are generally correlated to volumes or are variable based on usage and collectively increased year-over-year primarily due to growth in billed business and premium card accounts, contributing to a higher usage of travel-related benefits. Marketing expense increased 5 percent year-over-year, as we continue to invest at an elevated level in acquiring high spending, high quality customers and other growth initiatives. During the quarter we acquired 3.3 million proprietary new cards. We continue to invest in and enhance our Membership Model of premium payment products, differentiated membership services and partnerships and partner-funded value, including with our announcement in the quarter to acquire Tock and Rooam to build on the success of our Resy restaurant platform.
Previous wording
During the first quarter, we maintained our capital ratios within our current target range of 10 to 11 percent and returned $1.6 billion of capital to our shareholders in the form of share repurchases and common stock dividends. We also increased our quarterly common stock dividend by 17 percent. We plan to continue to return to shareholders the excess capital we generate while managing our CET1 capital ratio within our target range and supporting balance sheet growth. Our robust capital, funding and liquidity positions provide us with significant flexibility to maintain a strong balance sheet.
Current wording
During the second quarter, we maintained our capital ratios within our current target range of 10 to 11 percent and returned $2.3 billion of capital to our shareholders in the form of share repurchases and common stock dividends. We plan to continue to return to shareholders the excess capital we generate while managing our CET1 capital ratio within our target range and supporting balance sheet growth. Our robust capital, funding and liquidity positions provide us with significant flexibility to maintain a strong balance sheet.
Previous wording
The discussions in both “Consolidated Results of Operations” and “Business Segment Results of Operations” provide commentary on the variances for the three months ended March 31, 2024 compared to the same period in the prior year, as presented in the accompanying tables.
Current wording
The discussions in both “Consolidated Results of Operations” and “Business Segment Results of Operations” provide commentary on the variances for the three and six months ended June 30, 2024 compared to the same periods in the prior year, as presented in the accompanying tables.
Previous wording
Net card fees increased, primarily driven by growth in our premium card portfolios. See Table 5 for more details on proprietary cards-in-force and average fee per card.
Current wording
Net card fees increased for both the three and six month periods, primarily driven by growth in our premium card portfolios. See Table 5 for more details on proprietary cards-in-force and average fee per card.
Previous wording
Service fees and other revenue increased, primarily driven by increases in travel commissions and fees from our consumer travel business, revenue from the sale of reward points, foreign exchange related revenues associated with Card Member cross-currency spending and merchant service fees, partially offset by a benefit in the prior year related to a portion of the revenue allocated to a joint venture partner as described in Business development expense below.
Current wording
Service fees and other revenue increased for both the three and six month periods, primarily driven by higher merchant service fees, higher foreign exchange related revenues associated with Card Member cross-currency spending and higher income from equity method investments. The increase in the three month period was partially offset by Accertify revenues included in the prior year. The increase in the six month period was also driven by increases in travel commissions and fees from our consumer travel business.
Previous wording
Processed revenue decreased, primarily driven by a decrease in volumes associated with the decommission of one of our alternative payment solutions as well as a decrease in network partner volumes. See Tables 5 and 6 for more details on processed volume performance.
Current wording
Processed revenue decreased for both the three and six month periods, primarily driven by decreases in volumes associated with the decommission of one of our alternative payment solutions in the prior year as well as lower network partner volumes. See Tables 5 and 6 for more details on processed volume performance.
Previous wording
Interest expense increased, primarily driven by higher interest rates paid on, and growth in, customer deposits.
Current wording
Interest expense increased for both the three and six month periods, primarily driven by higher interest rates paid on, and growth in, customer deposits.
Previous wording
Card Member rewards expense was relatively flat, driven by an increase in cobrand rewards expense of $137 million, largely offset by a decrease in Membership Rewards and cash back rewards expenses, collectively, of $129 million. The increase in cobrand rewards expense was primarily driven by higher billed business. The decrease in Membership Rewards expense was driven by a $196 million benefit from enhancements to the models that estimate future redemptions of Membership Reward points by U.S. Card Members as well as lower redemption costs, partially offset by higher billed business.
Current wording
Card Member rewards expense increased for both the three and six month periods, driven by increases in Membership Rewards and cash back rewards expenses, collectively, of $148 million and $20 million, and cobrand rewards expense of $122 million and $259 million for the three and six month periods, respectively, all of which were primarily driven by higher billed business. The increase in Membership Rewards expense in the six month period was partially offset by a benefit from enhancements to the models that estimate future redemptions of Membership Reward points by U.S. Card Members as well as lower redemption costs.
Previous wording
Business development expense was flat, primarily due to increased partner payments driven by higher network volumes and contractual rates, offset by a prior-year charge related to revenue allocated to a joint venture partner.
Current wording
Business development expense increased for both the three and six month periods, primarily due to increased partner payments driven by higher network volumes, partially offset by lower client incentives. The increase in the six month period was also partially offset by a prior-year charge related to revenue allocated to a joint venture partner.
Previous wording
Salaries and employee benefits expense increased, primarily driven by higher compensation costs, reflecting the continued investment in our colleagues to support business growth.
Current wording
Salaries and employee benefits expense increased for both the three and six month periods, primarily driven by higher incentive compensation expenses, reflecting the continued investment in our colleagues to support business growth. The increase in the three month period was partially offset by lower current and deferred compensation costs.
Previous wording
The effective tax rate was 22.5 percent and 16.2 percent for the three months ended March 31, 2024 and 2023, respectively. The increase in the effective tax rate primarily reflected discrete tax benefits in the prior period related to the resolution of certain prior-year tax items.
Current wording
The effective tax rate was 20.4 percent and 20.5 percent for the three months ended June 30, 2024 and 2023, respectively, which reflected discrete tax benefits primarily related to the sale of Accertify in the current period and a legal entity restructuring in the prior period. The effective tax rate was 21.4 percent and 18.6 percent for the six months ended June 30, 2024 and 2023, respectively. The increase for the six month period primarily reflected discrete tax benefits in the prior period related to the resolution of certain prior-year tax items.
Previous wording
Non-interest revenues increased across all revenue categories, primarily driven by higher Discount revenue and Net card fees.
Current wording
Non-interest revenues increased across all revenue categories for both the three and six month periods, primarily driven by higher Discount revenue and Net card fees.
Previous wording
Discount revenue increased 7 percent, primarily driven by an increase in U.S. consumer billed business. See Tables 5, 6 and 10 for more details on billed business performance.
Current wording
Discount revenue increased 5 percent and 6 percent for the three and six month periods, respectively, primarily driven by increases in U.S. consumer billed business. See Tables 5, 6 and 10 for more details on billed business performance.
Previous wording
Service fees and other revenue increased 8 percent, primarily driven by increases in travel commissions and fees from our consumer travel business and revenue from the sale of reward points, partially offset by the change in the allocation of TLS revenues described above.
Current wording
Service fees and other revenue increased 16 percent and 12 percent for the three and six month periods, respectively. The increase in the three month period was primarily driven by the change in the allocation of TLS revenues in the prior year as described above. The increase in the six month period was primarily driven by higher travel commissions and fees from our consumer travel business and revenue from the sale of reward points.
Previous wording
Total expenses increased, primarily driven by higher Card Member services, Business development and Operating expenses.
Current wording
Total expenses increased for both the three and six month periods, primarily driven by higher Card Member services, Business development and Card Member rewards expenses.
Previous wording
Card Member rewards expense increased, driven by an increase in cobrand rewards expense, partially offset by a decrease in Membership Rewards and cash back rewards expense. The increase in cobrand rewards expense was primarily driven by higher billed business. The decrease in Membership Rewards expense was driven by the above-mentioned benefit from enhancements to the U.S. URR models as well as lower redemption costs, partially offset by higher billed business.
Current wording
Card Member rewards expense increased for both the three and six month periods, driven by increases in Membership Rewards, cash back and cobrand rewards expenses, all of which were primarily driven by higher billed business. The increase in Membership Rewards expense for the six month period was partially offset by the above-mentioned benefit from enhancements to the U.S. URR models as well as lower redemption costs.
Previous wording
Salaries and employee benefits and other expenses increased, primarily due to an increase in allocated service costs, which includes an allocation of TLS servicing costs as described above, partially offset by lower compensation costs.
Current wording
Salaries and employee benefits and other expenses increased for both the three and six month periods. The increase in the three month period was primarily due to higher compensation expenses, partially offset by higher allocated service costs in the prior year, which includes an allocation of TLS servicing costs as described above. The increase in the six month period was primarily due to an increase in allocated service costs.
Previous wording
Discount revenue increased 1 percent, primarily driven by an increase in commercial billed business. See Tables 5, 6 and 12 for more details on billed business performance.
Current wording
Discount revenue increased 2 percent and 1 percent for the three and six month periods, respectively, primarily driven by increases in commercial billed business. See Tables 5, 6 and 12 for more details on billed business performance.
Previous wording
Service fees and other revenue increased 29 percent, largely driven by the change in the allocation of TLS revenues described above.
Current wording
Service fees and other revenue decreased 20 percent for the three month period and was relatively flat for the six month period. The decrease in the three month period was largely driven by the change in the allocation of TLS revenues in the prior year as described above.
Previous wording
Card Member rewards expense decreased, driven by a decrease in Membership Rewards and cash back rewards expense, partially offset by an increase in cobrand rewards expense. The decrease in Membership Rewards expense was driven by the above-mentioned benefit from enhancements to the U.S. URR models as well as lower redemption costs, partially offset by higher billed business. The increase in cobrand rewards expense was primarily driven by higher billed business.
Current wording
Card Member rewards expense increased for the three month period and decreased for the six month period. The increase in the three month period was driven by higher cobrand rewards and Membership Rewards expenses, both of which were primarily driven by higher billed business. The decrease in the six month period was primarily driven by lower Membership Rewards expense, primarily due to the above-mentioned benefit from enhancements to the U.S. URR models as well as lower redemption costs, partially offset by higher billed business.
Previous wording
Business development expense increased, primarily due to increased partner payments, primarily driven by an increase in billed business and higher contractual rates, partially offset by lower client incentives.
Current wording
Business development expense decreased for both the three and six month periods, primarily due to lower client incentives, partially offset by increased partner payments, primarily driven by an increase in billed business.
Previous wording
Marketing expense increased, primarily reflecting higher levels of spending on customer acquisition and other growth initiatives.
Current wording
Marketing expense increased for both the three and six month periods, primarily reflecting higher levels of spending on customer acquisition and other growth initiatives.
Previous wording
Salaries and employee benefits and other expenses increased, primarily due to an increase in allocated service costs, which includes an allocation of TLS servicing costs as described above, partially offset by lower compensation costs.
Current wording
Salaries and employee benefits and other expenses decreased for both the three and six month periods, primarily due to higher allocated service costs in the prior year, which includes an allocation of TLS servicing costs as described above.
Previous wording
Discount revenue increased 11 percent, primarily reflecting an increase in international billed business. See Tables 5, 6 and 14 for more details on billed business performance.
Current wording
Discount revenue increased 9 percent and 10 percent for the three and six month periods, respectively (13 percent and 12 percent, respectively, on an FX-adjusted basis), primarily reflecting increases in billed business.2 See Tables 5, 6 and 14 for more details on billed business performance.
Previous wording
Net card fees increased 15 percent (18 percent on an FX-adjusted basis), primarily driven by growth in our premium card portfolios.2
Current wording
Net card fees increased 15 percent for both the three and six month periods, (19 percent on an FX-adjusted basis for both periods), primarily driven by growth in our premium card portfolios.2
Previous wording
Service fees and other revenue decreased 4 percent, primarily driven by a benefit in the prior year related to a portion of the revenue allocated to a joint venture partner as described in Business development expense below, partially offset by higher loyalty coalition-related fees and an increase in foreign exchange-related revenues associated with Card Member cross-currency spending.
Current wording
Service fees and other revenue was relatively flat for both the three and six month periods. Both the three and six month periods reflect increases in foreign exchange related revenues associated with Card Member cross-currency spending, offset for the three month period by a decrease in delinquency fees and for the six month period by a benefit in the prior year related to a portion of the revenue allocated to a joint venture partner as described in Business development expense below.
Previous wording
Card Member loans provision for credit losses increased, primarily due to higher net write-offs, partially offset by a reserve release in the current period, versus a reserve build in the prior period. The reserve release in the current period was driven by the performance of portfolios in certain international markets. The reserve build in the prior period was driven by higher delinquencies and an increase in loans outstanding.
Current wording
Card Member loans provision for credit losses increased for both the three and six month periods. The increase in the three month period was primarily due to a reserve build in the current period, versus a reserve release in the prior period, and higher net write-offs. The increase in the six month period was primarily due to higher net write-offs, partially offset by a lower reserve build in the current period. The reserve builds in both current periods were primarily driven by increases in loans outstanding, partially offset by lower delinquencies. The reserve release in the prior three month period was primarily driven by lower delinquencies, partially offset by an increase in loans outstanding. The reserve build in the prior six month period was primarily driven by an increase in loans outstanding and higher delinquencies.
Previous wording
Card Member receivables provision for credit losses decreased, primarily due to lower net write-offs and a higher reserve release in the current period. The reserve release in the current period was primarily driven by a decrease in receivables outstanding. The reserve release in the prior period was primarily driven by a decrease in receivables outstanding, partially offset by higher delinquencies.
Current wording
Card Member receivables provision for credit losses decreased for both the three and six month periods. The decrease in the three month period was primarily due to lower net write-offs and a higher reserve release in the current period. The decrease in the six month period was primarily due to lower net write-offs. The reserve releases in both current periods were primarily driven by lower delinquencies. The reserve releases in both prior periods were primarily driven by lower delinquencies, partially offset by increases in receivables outstanding.
Previous wording
Non-interest revenues increased, primarily driven by Service fees and other revenues and Discount revenue, partially offset by lower Processed revenue.
Current wording
Non-interest revenues increased for both the three and six month periods, primarily driven by higher Discount revenue and Service fees and other revenue, partially offset by lower Processed revenue.
Previous wording
Service fees and other revenue increased 13 percent, primarily due to higher merchant service fees and an increase in foreign exchange-related revenues associated with Card Member cross-currency spending.
Current wording
Service fees and other revenue increased 3 percent and 8 percent for the three and six month periods, respectively, primarily driven by higher merchant service fees and foreign exchange related revenues associated with Card Member cross-currency spending, partially offset by Accertify revenues included in the prior year.
Previous wording
GMNS receives an interest expense credit relating to internal transfer pricing due to its merchant payables. Net interest income increased, primarily due to a higher interest expense credit, primarily driven by higher interest rates and an increase in average merchant payables.
Current wording
GMNS receives an interest expense credit relating to internal transfer pricing due to its merchant payables. Net interest income increased for both the three and six month periods, primarily due to higher interest expense credits, primarily driven by increases in average merchant payables and higher interest rates.
Previous wording
Business development expense decreased, primarily due to decreased partner payments driven by lower contractual rates.
Current wording
Business development expense decreased for both the three and six month periods, primarily due to decreased partner payments driven by lower contractual rates.
Showing the first 40 of 86 pairs. Open the source sections for the rest.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
We will become a Category III bank holding company in the third quarter of 2024 as a result of our total consolidated assets exceeding $250 billion, calculated based on a daily average of total consolidated assets for the four quarters ended June 30, 2024, and thus become subject to heightened capital, liquidity and prudential requirements. See “Certain Legislative, Regulatory and Other Developments” for further information.
Current report — wording carried from elsewhere
The European Union (EU), Australia, Canada and other jurisdictions have focused on interchange fees (that is, the fee paid by the bankcard merchant acquirer to the card issuer in payment networks like Visa and Mastercard), as well as the rules, contract terms and practices governing merchant card acceptance. In the United States, certain states have passed or are considering laws to regulate various aspects of network operations and contract terms and practices governing merchant card acceptance, including information associated with electronic transactions (such as the use of specific merchant categories codes) and pricing of electronic transactions (such as interchange fees on sales tax or gratuities). In addition, changes in federal law and regulation have been proposed from time to time that could impact various aspects of network operations or contract terms and practices governing merchant card acceptance.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
Total Revenues Net of Interest Expense
Previous report — wording carried elsewhere
Card Member receivables provision for credit losses decreased, primarily due to a reserve release in the current period, versus a reserve build in the prior period, and lower net write-offs. The reserve release in the current period was primarily driven by lower delinquencies.
Previous report — wording carried elsewhere
Business development expense decreased, primarily driven by a prior-year charge related to revenue allocated to a joint venture partner.
Previous report — wording carried elsewhere
collections capabilities and recoveries of previously written-off loans and receivables; and governmental actions providing forms of relief with respect to certain loans and fees, and the termination of such actions;