American Express’ Revenue by Income Type (2016-2023)

This statistic highlights American Express’ Revenue by Income Type split between Total Non-interest Income and Total Interest Income, reported on a quarterly basis from Q1 2016 onwards,.

American Express’ Revenue by Income Type

The following table highlights American Express’ Revenue by Income Type for Q4 2020, Q3 2021 & Q4 2021:

(All figures are in billions, except percentages)

On a QoQ basis, the total revenue increased by 10.7%. Even on a YoY basis, there was an increase of 27.7% in the total revenue generated.

Total Non-interest Income

American Express’ total non-interest income primarily comprises Discount revenue, Net card fees, Other fees and commissions, and Others. 

• Discount revenue mainly represents the income earned on transactions occurring at merchants that have entered into a card acceptance agreement for facilitating transactions. A merchant discount is generally deducted from the payment to the merchant and recorded as discount revenue at the time the Card Member transaction occurs.
• Net card fees represent revenue generated from annual card membership fees. These typically vary based on the type of card and the number of cards for each account. Such fees are recognized on a straight-line basis and deferred over the twelve-month card membership period.
• Other fees and commissions include fees charged to Card Members, including foreign currency conversion fees and delinquency fees. These are primarily recognized in the period in which they are charged to the Card Member. It also includes Membership Rewards program fees, which are deferred and recognized over the period covered by the fee which is typically one year.

On a QoQ basis, this revenue increased by 12.35% as compared to the 34.65% increase on a YoY basis. A majority of American Express’ revenue, about 80% comes from this revenue type each quarter. 

Total Interest Income

Interest income primarily consists of Interest on cardmember loans, Interest and dividends on investment securities, and Deposits with banks and others. 

• The interest charged on Card Member loans is assessed using the average daily balance method. This interest is recognized based upon the principal amount outstanding unless the loan is classified as non-accrual. Recognition of revenue is done in accordance with the terms of the applicable account agreement, until the outstanding balance is paid, or written off.
• Interest and dividends on investment securities primarily relate to performing fixed-income securities. Interest earned on such securities is recognized as earned using the effective interest method. This method adjusts the yield for security premiums and discounts, fees, and other payments. This is done so that a constant rate of return is recognized on the investment security’s outstanding balance. 
• Interest on deposits with banks and others primarily relates to the placement of cash, in excess of near-term funding requirements. These are made on interest-bearing time deposits, overnight sweep accounts, and other interest-bearing demand and call accounts.

On a QoQ basis, there was an increase of 4.3% in the revenue generated. Even on a YoY basis, there was an increase of 4.9% in the revenue from this income type. 

About the Company

American Express is a globally integrated payments company that provides credit and cards to consumers, small businesses, mid-sized companies, and large corporations around the world. It is listed on the NYSE with the stock ticker AXP.

American Express issues cards that can be used by members to make purchases at the millions of merchants around the world, wherever accepted. These can be issued by the company themselves, as well as by third-party banks and other institutions in their network. 

American Express provides various products and services, which are sold across the globe to a diverse customer group 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 
• Direct response advertising

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