Okay, we're going to get started. Thank you. Good morning. Thank you, everyone, for joining. My name is Terry Ma. I cover Consumer Finance at Barclays, and I'm pleased to have on stage Kristof Le Caillec, CFO of American Express. Welcome, Kristof. Thank you for having me. I guess we'll jump right into it. Maybe we'll just start with an update on the consumer. That's probably top of mind for many investors. American Express consumer billings growth has been pretty resilient this year in spite of uncertain macro. It was up 7% FX-adjusted through the first half of 2025 compared to 7% for fiscal year 2024. How's the consumer shaping up so far in the third quarter? Good morning, everyone. As you know, we don't talk much about interquarter performance, and you're right. We talked about 7% billing growth year to date. When we talked about Q2, you might recall that I talked about some softness in the T&E space, especially in airline. In July and August, we've seen a bounce back from that. Those numbers look better. There's a lot of continuation in terms of the trends, stability, and strength we've seen in the consumer space. Retail spend is also doing well. I would say it's looking good and much better than what the headline or the newspaper would suggest. Okay, that's great to hear. Let's turn to commercial. Can you maybe just update us on the trends you're seeing in commercial? In particular, SME, that's been in a soft spot for a while. Any idea what that segment needs to see to lap some of that softness? Yeah. I think the way to think about this segment and the way we look at it internally is we've bifurcated the portfolio, if you want, between what I would call small businesses. These are the small shops, the accountants, the architects, the dentists around the corner, and the medium size, the middle market, the medium size businesses. We call them the middle market. What you see is a big difference in terms of spend patterns and behaviors there. The smaller part of that segment is actually performing very consistently with the consumer business, and you see very similar numbers. Where you see softness is actually in this middle market segment. There are a few things going on there. First of all, I think the macro is not very supportive there because when I look at all the other financial institutions who actually report their numbers on commercial spend, especially in that middle market segment, we kind of see the same numbers, right? Low single-digit growth. For some of our competitors, it's even negative. What's happening here, I think, is there are at least two things. One is, and we talked about it in the past, where we see the biggest pressure point is under very large transactions, transactions north of $100,000, $200,000. It's surprising in the first place that these transactions are on credit card rails, but these are the ones where we see a shift towards ACH. That's happening. It will take time, I think, to kind of filter through the system. The other thing that is happening here is that more and more this middle market segment wants and needs to have expense management solutions. Having a card is not enough. They need expense management solutions, and we see a clear trend there. We think that's where the puck is going. That's the reason why we made the acquisition of Senner a few months ago, because it's an expense management solution company. The team at American Express is working really, really hard to integrate these capabilities and make it available to all our customers, but especially those who are in that middle market segment. That's what I would say. How long is it going to take to turn around? I think it will take a few more quarters, probably, for these very large transactions to stabilize. For Senner, soon you'll hear back from us in terms of having this capability available to our account members. Okay, that's helpful. Maybe we'll just touch on international. That's been a bright spot for American Express. That segment was about 25% of billed business last quarter. It's been growing double digits and outpacing other segments. Can you just talk about the drivers of success in that segment and how sustainable the growth is? It's a great success story indeed. If you take a step back, you look at the International Card Services segment, ICS, over the last three years, we grew spend by 50%. It's very hard to grow a business of that kind of magnitude, that scale on a global basis or an international basis by 50%. That's what we achieved. When you look at the details, you see a lot of strength across many markets and many dimensions. If you want to unpack the fundamentals behind what's supporting and sustaining that growth, there are a few things, right? First, we're starting from a lower market share. Across the top five markets, we have about 6% market share. Our opportunity to grow is huge, right? It's something we see as an upside for us. That's one of the reasons why, everything else being equal, we actually invest a bit more in international than the U.S. because we see that opportunity. Another thing that is super important for investors to understand is that we've been playing a very long game in international for years, right? That's where I spent most of my career. One of the big challenges we had, and we are making a ton of progress on it, was coverage, right? For those of you who have traveled outside of the U.S., I'm sure you've experienced the difference in terms of merchant coverage. We're making a lot of progress on merchant coverage. I think we just released a few days ago a new number for merchant coverage. We've reached 160 million merchant coverage globally. That's not international, that's global. It tells you about the progress we're making there. In the top 12 markets for us, the coverage is now north of 80%. We are very diligent, very focused on some cities that we want to win on verticals, on digital commerce. The coverage we make, the progress we're making on coverage is definitely part of the growth story here, right? We're making progress on coverage, which makes it easier and more compelling for card members to take the card. You kind of build those in parallel, and you get what we're getting, a ton of momentum across the board. Got it. We think that there's a long runway there. Okay. Maybe digging a little deeper, what countries are you seeing the strongest growth? What about your strategies helping differentiate American Express? How do you expect the growth trajectory to shape up moving forward? Any medium-term goalposts you have in mind? As I said, you know, we see to grow, you know, so consistently for so long, you just need to have a broad base, kind of like momentum, which is exactly what we're seeing. If you look at the more recent data over the last, I think it was in Q2, the biggest growth was in Australia and Japan. Japan is a super important market for us because it's a very large economy, because we have very good coverage in Japan, given the partnerships that we have out there. You know that it's a, you know, the brand carries a lot of weight in Japan. It's also a market, interestingly, where cash is still playing a big role. The digitization of payment is also part of the success story in Japan. It's one example of where we've been able to grow sustainably for many, many years across the entire market. We're very pleased with the growth there. If you kind of like look at, you know, the kind of assets that we have and that we've developed and built over the years, partnerships is a key one. We have partnerships with our biggest airline out there, whether it's British Airways, Air France-KLM, ANA in Japan, Qantas. Those partnerships go back, you know, decades. We know each other really well. We work really well together. I talked about the progress we're making on coverage. We have built, you know, like an amazing franchise, which is similar to the one in the U.S., but different also in its own way. I would say it's more premium out there than in the U.S. If you look at the P&L, you're going to see that NII is actually playing a smaller part in the economics, and card fees is actually, you know, a bigger part of their revenue mix. The behaviors as well of our customers are slightly different. We're seeing much more cross-border spend, like something like 23% of cross-border spend in international versus like 5% in the U.S. That gives us more opportunities as well. It's a more T&E heavy, more premium kind of portfolio book, as well, as I said. It's a very interesting franchise. As I've said, you know, we've been working on this for, I don't know, 30, 40 years. It's very profitable, very attractive, and there's a very long runway in terms of growth here. Got it. That's helpful. Maybe we'll just touch on revenue growth in the guide. You've guided to 8% to 10% revenue growth for the year. First half was 9% FX-adjusted year to date. How do you feel about that guide at this point in the year? I feel good. I guess you would be surprised if I'd said anything else, but I feel good. As you said, you know, we guided 8% to 10% revenue growth year to date. We are 9% FX-adjusted, 15% to 15% to 15% in terms of earnings per share. We're at 71%, 71%, I think, year to date. We are tracking well against that guidance. I feel really good. We have momentum. As you know, we have a big product refresh that is coming up in a few weeks from now. The team is very busy executing on the growth plan. I feel really good about where we are and what's ahead of us. Got it. What about the aspirational 10% revenue growth that you put out there? Looking out long term, what do you really need to see for American Express to potentially hit that aspirational goal? Maybe take a step back and go back to 2022, January 2022, when we introduced that growth plan. In 2022, we delivered 27% revenue growth. In 2023, it was like 15%. Last year, I think it was 10% FX-adjusted. I just talked about the first two quarters where we had 9%. When I look back at what we did, I feel that that was definitely the right aspiration and the right ambition for us. I'll say this as well, and I repeated it many times, but this was never meant to be a forecast. It was also never meant, obviously, to be a guidance. What it's meant to do is articulate internally and externally what we want to do with this company and with this franchise, right? We think that there is a very large growth opportunity for us, and we need to go after it. This vision did an effective job at energizing the entire American Express colleague base of 75,000 colleagues. There are many things that happen as a result of laying out that ambition. The cadence of product refreshes, the innovation, the pace at which we have negotiated those partnerships, all of that, you can track it back to laying out that ambition out there and saying, we're going to be a growth company. I feel really good about that. The other thing that I'll say, because it's an important thing to understand, is that we articulated that ambition, and we set up a very large constraint because we said we want to grow in the premium space. Every quarter, I come in front of you and I say, here is the number of new cards we required, and there is about 70% of those cards that are on a fee-paying product, right? We constrained ourselves to grow and to deliver on that ambition within the premium space. If we were to relax that and open up the credit box, we could deliver like 10% on a regular basis, but we don't want to do that. What we want to do is just deliver on that 10%+ on the revenue base, sustain that mid-teens EPS every year, and have a very stable, resilient business that can go through a business cycle. It's those three things together that make it challenging. I feel that it's the right business model. It's definitely a model that is accretive in terms of shareholder value down the road, and we are making great progress on it. That's great to hear. We'll switch gears and maybe just address competition. There are a number of announcements this year. Chase Sapphire Reserve got refreshed. It is effectively reentering the market with the Strata Elite. Obviously, Capital One recently closed the Discover acquisition. TBD what they do with VentureX. How would you characterize the competitive environment, particularly for premium cards? It certainly feels like it's the first time in a decade that the premium card space has been this competitive. Yeah. You know, I've been in this industry for almost 30 years in different geographies. I think that there's not been a year where it was not a competitive market for many reasons, right? One of them is because it's typically the most profitable product that our financial institution has, and the premium space is definitely the most attractive space for everybody, including for ourselves. For a long period of time, we were kind of like the only player in that space. Part of our challenge was actually to educate consumers and small businesses and convince them to pay a fee. What the competition did was actually to cover some of these education costs, I would say. The number of customers now, especially on the consumer side, who are considering signing up for a premium card, is much bigger now than it was back then. As the leader of that category, we always benefit from that. Even with the announcements that you talked about, I read a lot of those articles as well, just like many of you. I don't think I found one where they were not mentioning American Express. I mean, they start by talking about our competitors, and then they talk about American Express, right? Those who are actually reading those articles are considering American Express as well. We benefit from that. I think that competition, I don't know whether it's more intense than it was back then, but it's definitely benefiting consumers. They have choice. They have more products to choose from. It definitely benefited us. Our Platinum franchise is bigger than it has ever been. I do recall back in 2017 when one of our competitors launched their product, there were some concerns about American Express. We've seen nothing but growth and very strong growth in the Platinum space for a decade now. I feel that we are ready for it. Got it. The product refresh cycle has been a crucial part of American Express's strategy. You refreshed Delta co-brand cards and Gold last year. As you mentioned, Platinum Card will be refreshed in a few weeks. Can you maybe just talk about your learnings from the Delta co-brand cards and Gold refreshes last year, and then how you're approaching Platinum refresh this year? More importantly, how do you position a Platinum Card relative to the other products out there? First of all, I'm not going to tell you what's going to be in this new product refresh, right? You're going to have to wait a few more weeks to find out. If you go back to Gold and Delta, right? These were two big refreshes. If you take a step back and look at what has happened over the last two years, it's interesting because we see actually a lot of similarity in terms of what those refreshes did to the financials. We saw a significant increase in their number of accounts, about 10% over the last two years. The fee line on those products went up by 60%. The revenue on those two products is up about, for each of them, about 30%. Maybe what's most remarkable is when you look at what we call the spend retention, right? We look at whether we lost any billing and any card member along the way. The spend retention was 98%. It's like an eye-watering 98%. That's very much the way we think about those product refreshes. A lot of people, and I saw a lot of those articles, talk about the price point. This is not how we think about product refreshes. The way we think about it is that the marketing team, the product team, they look at what's the best value proposition we can create for our card members, what are the best partnerships, what kind of access we can provide them, what kind of differentiated value proposition we can put forward, execute on at scale. We build these products, attractive products, and then we figure out what's the right price point for that. We're not trying to flex the pricing level. What we're trying to do here is create value for card members with partners and make it available to customers, right? We were talking about Gold a few minutes ago. In the case of Gold, the equation was that we increased the value proposition by $400 and we increased the price point by $75. When you are one of those customers and you have a Gold card and you look at, okay, I can get as much as $400 more in terms of value and, you know, I'm going to pay $75, it's a no-brainer decision, hence their super high retention rate. The reason why I'm telling you all of that is to share with you the philosophy that we have as we think about how we're managing those decisions, how we're making those decisions. It's also to either help you understand how we're thinking about the economics. You should expect exactly the same model as we think about the Platinum Card. It will be a version of that that will be revealed very soon. Got it. Maybe this is a good point to pause for our first audience response question. Can you just queue that up, operator? If everyone can just use the controllers to register your response. Question is, which premium credit card do you have at the top of your wallet? One, American Express. Two, Capital One Venture X. Three, Chase Sapphire Reserve. Four, Citi Strata Elite. Or five, none of the above. Other. You see. Platinum, almost 40% followed by Chase Sapphire Reserve, then 25% other. Yeah, I guess a lot of these other are Centurion card. Yes, yes. I'm going to add a Centurion Card in there next year. Maybe just talk about how you continue to differentiate the value prop for a product like Platinum and also how you think about that ability to price given the competitive landscape. I talked about pricing, so maybe I'm not going to get back to it, but the ability to create a differentiated value proposition is critical here. I was talking about how we're thinking about partnering. Remember, in the case of the Gold Card, we made a partnership with Dunkin' Donuts and co-creating some kind of value and they're co-funding it. What's critical here to the approach of the Platinum refresh is exactly the same thing, right? It's partnering with big brands out there to create value proposition and they co-fund that value proposition. As I said, we price for it. The other thing that is critical for investors to understand here is that this value proposition is evolving, right? It's not like it's static at the time of the refresh. Of course, at the time of the refresh, we have an opportunity to rebuild the product, but we kind of keep working at it constantly. A key element of the Platinum value proposition, and I'm sure you guys are familiar with it, is the FHNR, Fine Hotels and Resorts, and the Hotel Collection. We just announced recently that we increased the number of properties by, was it like 400 more properties? This means that there are 400 more properties that actually want to join the program because they see the value in this program and they're happy to fund an early check-in, a late check-out, and a free breakfast, right? It's almost like two extra nights at the hotel. This is important because this is a way for us to create value for the card member and have a big part, if not all, of the value being funded by the partner I just talked about for FHNR. This is very much the way we think about it, with partnerships and in a dynamic way so that we can refresh the value, keeping it fresh. As I said, we then try to find the right equation in terms of pricing. What's the right price point for that value? Got it. American Express has gained traction with Millennials and Gen Z. These two cohorts have been a big driver of your card acquisitions, making up 60% of new accounts and 75% of Platinum and Gold new accounts. As we kind of think about the total addressable market and the market share of those two cohorts, how penetrated are you and what's the runway for growth? I'm going to bring you back to a longer horizon here. If you go back to like 10, 15 years ago, one of the constant questions we were receiving is like, how much relevant you are? Are your brand, your products relevant to the younger generation? There was a real concern that we would not be able to actually be relevant to these younger folks. We addressed that question. We're now very relevant to this generation. We did that by evolving the product, the value proposition, evolving the brand. For instance, in terms of sponsorships, we have a big sponsorship with Formula One, for instance. As you saw in the various recent refreshes, you know, we added a streaming bundle and credit, like value proposition, dining credit that resonated much more to the younger population. That worked out really, really well. For us, the way to think about it is like it's increasing our total addressable market. These are people that we were not focused enough on 15 years ago. Now they're joining the franchise and we are seeing their behavior, right? Their behavior is going to dictate the economics of American Express 15 years from now. They're joining us on a fee-paying product. They're giving us a big share of their wallet because we have parity coverage. They're very engaged with the product, the value proposition. They use the benefits quite a lot. Interestingly, the cost of servicing for us is much lower than for the baby boomers, like as much as like 40% lower than the baby boomers. If you look at the older generations, we still have a lot of card members in the older populations that are calling us every month to make a payment by phone versus that is not happening with the younger population. As you think about that, that's displacing as well a lot of expenses. I talked last quarter during the earnings release about the economics and their credit profile. I shared with investors, not only the credit performance of this population is a lot better than the Gen X and the Gen Z and the Millennials in the market, but it's even 40% better than the Gen X and the baby boomers of our competitors. This is a very attractive segment. They're joining American Express. They're loyal to American Express. They're going to be with us for a very long period of time. You need to think about that as kind of like a creative in terms of growth. I'm going to make one more point on this Platinum conversation and the competition, which I think is an important one. Behind the announcements and the headlines, what's critical here is the ability to execute on those promises. This is where American Express is a different kind of company, right? Many of you, 40% of you, carry a Platinum Card probably for that reason, right? It's because you know that when you're going to call us, we're going to pick up the phone and we're going to help you out. This ability to service is actually critical. Recently, JD Power just released their latest survey. Again, we're the best product, and Platinum in its category as well is the best product. That speaks a lot about our heritage and the capabilities that we have, the talent that we have to execute on the servicing of these products. Great. As you evolve the benefits of the premium cards in recent years to cater to the younger generations, how do you kind of find a balance and not lose appeal to the older generations? Gen Z and baby boomers are still about 65% of total consumer billings. Yeah. You're absolutely right. The word we use internally is generational relevance. We are very much aware of what you just said, right? I mean, we still have a very large share of our portfolio customer base and economics relying on the Gen X and the baby boomers. It's super important for us to focus on that. The way we think about those is that first, as I just told you, we're not forcing you to make your monthly payment through the app, for instance, right? If you want to call us, we have people on the phone picking up the call, right? We're very much aware that we need to have various channels that will work to the variety of our customer base. That's for one. The second thing is, as we think about the benefits, there are benefits for everybody in the products, right? For older generation, for younger generation. The streaming benefits appeal much more to the younger folks than the older ones. This being said, when you look at a benefit, for instance, that is super popular, for instance, the Uber credit benefit, you look at the Gen X versus the younger population, it's pretty much the same, right? There's not as much differences as you might think, as you maybe you think. Finally, I'm going to come back to what I was just talking about. What all this kind of like population has in common is they want service. They want that experience, right? That is across the board what we're trying to provide, whether you are a baby boomer or whether you are Gen Z. You can expect service, quality, security, and integrity from American Express. Got it. That's helpful. Maybe we'll just turn to lending and credit. NII growth continues to be robust. It was up 12% year over year last quarter. You had mentioned a big driver is the increased margin on lending. Can you just talk about what you've done to improve the margin and how much more room is there for you to kind of expand it? Yeah. In the last quarter, we actually introduced a different visual because we wanted to make that point as clear as possible. We had, over time, a lot of questions about NII growth. We wanted to make it more visible and easier for investors to understand how much of their NII growth is a function of volume growth versus a function of NIM growth, margin growth. If you look at, say, from 2019 to now, it's about, not quite, but it's about 50-50, right? Half of the growth is margin expansion, which is super important because first, it was intentional. Second, when you look at that in relationship with credit performance, it means that the margin is much, much higher because the credit performance was very stable over this period of time. The things that are behind that NIM expansion, there are a few things, right? One was innovation in terms of introducing new features that allow card members to revolve a portion of their spend. I'm talking about Pay Over Time, which has been a big driver of growth. It improves the revolve rate. It grows the revolve rate. The second thing here that has been a very important driver of that NIM expansion is the evolution of our funding mix. Back in 2019, I think it was 25% of the funding of the balance sheet. Now it's 60%. There's still more to come, right? Back to your question about how much more expansion there is. The third element here that I want to point you towards is the pricing discipline that we have used and executed on over the last four or five years, pricing for risk in a more disciplined way. We actually are not using 0% offers anymore. That lending book benefited from all of that over the last four or five years. How much more is there to come? There is a bit more, not as much as what you've seen historically, but there's still a bit more NIM expansion to come. Okay, great. When we think about credit performance, American Express leads the industry. Your delinquency rates are below pre-pandemic levels, and the outperformance relative to the rest of the industry has been widening. One driver is clearly the focus on the premium segment. Aside from that shift, what else have you done on the tech side and underwriting side to kind of help sustain that? The first thing here that I need to say is that this was intentional, right? This was the outcome of the strategy we laid out when we say we're going to grow in the premium space. We wanted to grow in the premium space not only because we are American Express and our brand resonates in that space, but also because this is the best way to take care of the credit risk. We know that we run the company for the long term. We know that we're going to go through cycles. It was important for us to be intentional about having a book that can be profitable through the cycle. I want to remind you of the CCAR results and how profitable we remain through the cycle. That was like the first element, just like, let's grow in the premium space. That's not everything. We have, for years, invested in data, talent, building models, technology, infrastructure to actually manage proactively that credit exposure. We have used AI and artificial intelligence for, I think it was started in 2010, right? I think we were one of the first institutions to do that. We keep doing that, right? We keep evolving those models. I'm just going to give you an example on the Platinum Card, the charge card. You know, it's a no preset spending limit, right? The way the technology works in combination with data and AI is that every swipe of the card, there's like a ton of models that are being run. We have as many as 4,500 different rules. In a fraction of a second, we approve or decline that transaction. Most of the time, we approve it. That's how we manage the credit risk on these big ticket items, right? This is a technology that is super sophisticated, that is proprietary. I don't think any of our competitors are getting close to that. It's definitely part of why we are maintaining that hedge and that advantage versus our competitors. We keep investing in it, right? Great. Maybe we'll just pause and queue up those last two ARS questions. First one, do you expect 2026 FX-adjusted revenue growth to be one, 7-8%; two, 8-9%; three, 9-10%; or four, 10% or higher? Majority, 52%, at 8-9%. Next question. Over the next year, would you expect your position in American Express to one, increase; two, decrease; or three, stay the same? I think there's a good answer to that one. Oh, so good. Yeah, good. 46% increase, 42% stay the same. Pretty bullish. We have about three minutes left. I'll just open it up to the audience if there are any questions. We have one up front here. Yeah, you are going to get a mic. Hi. Hi. I just wanted to see if you could provide any more color around, you highlighted in the Gold and the Delta refreshes that, you know, the number of accounts went up 10% over two years. I think the fees went up 60%, and total revenue up 30% on those two categories over two years, right? The retention was 98%. You failed to mention what did BCE go up, like the expenses associated with that. I mean, I know I've talked about this before, but if you're offering people $400 worth of value, I know you're not paying for all of it, but you're paying for some of it. Yet you're only increasing the card fee by $75. Can you just talk a little bit about when you do these refreshes, does profitability also go up? You know, because that was the piece that you sort of left out. Yeah, yeah. It was not intentional. I don't have the VCE ratio. I can't share it with you. It's not because I don't want it, but I don't have it. When we refreshed the product, one of the objectives is definitely to improve, at a minimum, to maintain the profitability. The other objective, of course, is to increase the demand for the product. Of course, what we're trying to do as well is just be intentional about that retention and engagement of the base. Maintaining or improving the profitability is definitely part of the objective here. I don't have in mind the result of the Delta and Gold card, but the way to think about it also is just to think about VCE not only like, and maybe it's because of the way we talk about it. One way for us to get efficiency and profitability is also to factor into account the credit performance, right? I also failed to say that the credit performance post this refresh is just probably at a minimum as strong as it was before, right? The challenge for us is to keep growing the portfolio, maintaining or improving the profitability, and improving the risk profile, which in aggregate we said has been improving versus 2019. It's that magic equation that we're solving for with those product refreshes. Okay, I think we're at time with that. Thank you. Thank you.