Travel and entertainment spending by American Express corporate customers increased 6 percent year over year to $27 billion in the third quarter of 2023, as the financial services giant reported slowing SME growth and flat spending by large and global corporate customers in the United States.
The $27 billion in T&E spending was flat compared with the second quarter, as was total spending of $130 billion. The $103 billion in spending on goods and services by corporate customers was flat year over year.
Total spending by U.S. SME clients was up 2 percent year over year in the quarter, similar to the growth rate in the prior quarter, CFO Christophe Le Caillec said in an earnings call on Friday. While growth in the segment has slowed, “we do continue to see strong high-quality demand for new accounts within this segment,” he said. “Looking forward, we will focus on continuing to help SME clients run their businesses.”
Total spending by U.S. large and global clients, meanwhile, was flat year over year. “These customers are not a major growth driver for our business, but they remain an important foundation for the company’s business model,” Le Caillec said.
Spending growth among cardholders outside of the U.S., however, is offsetting the “softness” for Amex’s U.S. commercial services, he said.
Total T&E spending by international clients, which includes both consumer and business clients, was up 20 percent year over year in the quarter to $26 billion. International SME and large corporate spending inclusive of both T&E and goods and services, which represents 35 percent of Amex’s total international volume, was up 15 percent year over year.
T&E spending by U.S. consumer cardholders increased 13 percent year over year to $47 billion during the third quarter, Amex reported. Increased card member spending alongside higher average loan volumes pushed Amex’s total third-quarter revenues up 13 percent year over year to $15.4 billion. It was the sixth consecutive quarter of record revenue for the company, according to Amex.
Amex reported net income of $2.45 billion for the third quarter, up from $1.88 billion in the third quarter of 2022.
