American Express (AXP) Q2 earnings

Credit card giant American Express raised its full-year profit forecast on Friday, as its wealthy customers persisted in splurging on travel, dining and entertainment.

The company also reported better-than-expected second-quarter profit, underscoring the benefit it has enjoyed by focusing on a premium customer base.

AmEx’s affluent cardholders have somewhat insulated it from weakness in the broader economy, even as rival lenders warn of tepid demand due to elevated borrowing costs.

“Increased scale, combined with our premium, high credit quality customers, our well-controlled expense base and our successful investments… fuels the earnings power of the core business,” CEO Stephen Squeri said in a statement.

The company sees its 2024 earnings per share between $13.30 and $13.80, versus the $12.65 to $13.15 range it had forecast earlier. In the second quarter ended June 30, profit was $3.02 billion, or $4.15 per share, 39% higher than a year ago.

Excluding a one-time gain from the sale of its fraud prevention technology unit, Accertify, the company earned $3.49 per share, higher than analysts’ estimate of $3.24 per share, according to LSEG data.

Revenue jumped 9% to a record $16.33 billion, but fell short of an LSEG estimate of $16.59 billion. Shares of the New York-based company fell 2% in premarket trading.

Last month, the company agreed to buy restaurant-booking platform Tock from Squarespace to expand its foothold in the dining industry.

The acquisition could support AmEx’s efforts within the small-and-medium-enterprise market, according to analysts.

AmEx views the segment as lucrative despite a recent slowdown in SME spending growth.