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Document

January 19, 2024

By EDGAR Correspondence

Division of Corporation Finance

Securities and Exchange Commission

Attention: Marc Thomas and Robert Klein

100 F Street, N.E.

Washington, D.C.20549

Re:

 American Express Company

Form 10-K for the Fiscal Year Ended December 31, 2022

Filed February 10, 2023

Form 10-Q for the Quarterly Period Ended September 30, 2023

Filed October 20, 2023

File No. 001-07657

Dear Messrs. Thomas and Klein:

We refer to the comment letter, dated December 19, 2023, from the staff (the “Staff”) of the Division of Corporation Finance of the Securities and Exchange Commission (the “Commission”) concerning the American Express Company (the “Company,” “American Express,” “we,” or “our”) filings referenced above.

We have restated below the text of each of the Staff’s comments, followed by the Company’s response.  The Company will revise its future filings in response to the Staff’s comments, beginning with its Annual Report on Form 10-K for the year ended December 31, 2023 (the “2023 Form 10-K”), unless otherwise noted in the response.

*  *  *  *  *

Form 10-K for the Fiscal Year Ended December 31, 2022

Market Risk Management Process

Interest Rate Risk, page 75

Comment 1

We note your disclosures surrounding interest rate risk, which includes a sensitivity analysis that a hypothetical, immediate 100 basis point increase in market interest rates has on your net interest income.  We also note that your 2023 quarterly reports do not present tabular or expanded narrative disclosure under Quantitative and Qualitative Disclosures about Market Risk. Please further expand your sensitivity analysis disclosures, in future filings, to present additional quantitative information that expresses an impact your net interest income resulting from additional selected hypothetical changes in interest rates (e.g., -100 basis point decrease, +/- 50 or +/- 200 basis point change, etc.).  Additionally, revise future filings with interim period financial statements to include expanded tabular and more fulsome narrative disclosures regarding changes, to the extent material.

Securities and Exchange Commission

January 19, 2024

Page 2

Response 1

We will enhance our disclosures in future Annual Reports on Form 10-K by expanding our sensitivity analysis disclosures and presenting the impact on our net interest income resulting from the hypothetical instantaneous changes in interest rates of +/-100 and +/-200 basis points, which we believe will best aid investor understanding of our interest rate risk.

An illustrative example attached as Exhibit I hereto includes the enhanced disclosure described above. We will include expanded tabular disclosure and relevant qualitative discussions in future Quarterly Reports on Form 10-Q to the extent there are material changes in information from the end of the preceding fiscal year to the date of the most recent balance sheet included in any such Quarterly Report on Form 10-Q.

Comment 2

Your disclosure also states that you analyze a variety of interest rate scenarios to understand the potential impacts from interest rate changes on the economic value of equity. Please revise your disclosures, in future filings, to provide a more comprehensive discussion of how you use the economic value of equity to manage your interest rate risk. Ensure that your revised disclosures include a discussion of the model, key assumptions and a discussion of any changes in these key assumptions from period to period along with the factors driving any changes. Refer to Item 305(a)(1) (ii)(B) of Regulation S-K.

Response 2

We will enhance our disclosures in future Annual Reports on Form 10-K to provide a more comprehensive discussion of how we manage our interest rate risk using the economic value of equity, including the model, key assumptions, and how economic value of equity informs our interest rate risk management.

An illustrative example attached as Exhibit I hereto includes the enhanced disclosure described above. To the extent there are any material changes in our model or key assumptions from period to period, we will discuss the nature of the changes and the factors driving such changes.

Form 10-Q for the Quarterly Period Ended September 30, 2023

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Table 5: Selected Card-Related Statistical Information, page 7

Comment 3

We note your disclosure of discount revenue as a percentage of billed business. Please revise your disclosures, in future filings, to clarify whether the discount revenues as a percentage of Billed business are similar or different for each of the identified segments billed business and address the reasons for any differences. To the extent applicable,

Securities and Exchange Commission

January 19, 2024

Page 3

disclose the percentage for each segment and explain reasons for changes to the percentage between any periods being presented.

Response 3

As disclosed in our Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2023 (the “Third Quarter 2023 Form 10-Q”), on page 30 in the “Glossary of Selected Terminology” section in Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”), “billed business represents transaction volumes (including cash advances) on payment products issued by American Express.” Where we disclose billed business, it consistently represents these volumes for the relevant reportable operating segments.

Also on page 30 in the “Glossary of Selected Terminology” section in MD&A, we state “discount revenue represents the amount we earn and retain from the merchant payable for facilitating these transactions between Card Members and merchants on payment products issued by American Express.”

We provide disclosure of discount revenue as a percentage of billed business, in the aggregate, to provide insight into the economics associated with the average pricing  for merchants accepting cards on the American Express network,   irrespective of which operating segment issued the card presented. While our reportable operating segments reflect the way management organizes the segments within the Company for purposes of making operating decisions and assessing performance, decisions with respect to merchant pricing are generally not made at the segment level. When merchants agree to accept cards on our network, the amount of fees charged for accepting American Express cards as payment (including cards we issue as well as cards issued by network partners) varies with, among other factors, the industry in which the merchant conducts business, the merchant’s overall American Express-related transaction volume, the size of the relevant transactions, the method of payment and related settlement terms, and the competitive and regulatory landscape in which we and the merchant operate, generally without regard to the effect such pricing will have on the results of our reportable operating segments.

Further, our internal allocation of revenue, including discount revenue, among segments is described on page 50 of our Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Form 10-K”) in the “Business Segment Results of Operations” section in MD&A, as follows:

We allocate discount revenue and certain other revenues among segments using a transfer pricing methodology. Within the USCS [U.S. Consumer Services], CS [Commercial Services] and ICS [International Card Services] segments, discount revenue generally reflects the issuer component of the overall discount revenue generated by each segment’s Card Members; within the GMNS [Global Merchant and Network Services] segment, discount revenue generally reflects the network and acquirer component of the overall discount revenue being allocated.

In light of the above, while we respectfully acknowledge the Staff’s comment, we do not believe that discount revenue as a percentage of billed business for each reportable operating segment, which will vary from segment to segment, is an appropriate measure to disclose to investors

Securities and Exchange Commission

January 19, 2024

Page 4

because it does not reflect the process used by the Company to negotiate and determine merchant pricing or the true economic pricing we actually offer to merchants.

Business Segment Results of Operations

U.S. Consumer Services

Total Revenues Net of Interest Expenses, page 10

Comment 4

We note your disclosure that effective as of the second quarter of 2023, your U.S. travel and lifestyle services (TLS) results are now reported within both the USCS and Commercial Services (CS) segments. Please revise, in future filings, to quantity and disclose the impact on service fees and other revenue, as a result of the change in the allocation of travel and lifestyle revenues to both the U.S. Consumer and Commercial Services segments.

Response 4

In the “Business Segment Results of Operations” section on page 10 in MD&A in our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023 (the “Second Quarter 2023 Form 10-Q”), we disclosed that a portion of U.S. Travel and Lifestyle Services (“TLS”) results, previously reported within the U.S. Consumer Services (“USCS”) segment, would now be reported within the Commercial Services (“CS”) segment.  This prospective change represented an insignificant portion of results for both segments. It was equal to less than 1% and approximately 1% of total revenues net of interest expense and total expenses, respectively, for USCS, and approximately 1% of both total revenues net of interest expense and total expenses for CS, in each case for the quarterly period ended June 30, 2023. Further, Service fees and other revenue represented less than 5% of total revenues net of interest expense for both USCS and CS for such period. As described in the “Business Segment Results of Operations” section in MD&A on pages 10 and 13 in each of the Second Quarter 2023 Form 10-Q and the Third Quarter 2023 Form 10-Q, this change in the allocation of TLS results was a driver of year-over-year variance for Services fees and other revenue for the USCS and CS segments.

We will enhance the year-over-year variance commentary to provide increased context as to the extent to which the allocation of TLS results drove changes in segment results of operations in the 2023 Form 10-K and the Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2024 (which is the last reporting period in which the change in allocation will result in year-over-year incomparability). An illustrative example attached as Exhibit II hereto includes this enhanced disclosure.

Expenses, page 11

Comment 5

Please revise your disclosure, in future filings, to provide more quantification of the individual components and changes in your expenses relating to the individual allocated service costs, Card Member rewards expense and Card Member services expense, as well

Securities and Exchange Commission

January 19, 2024

Page 5

as salaries and employee benefits expenses for the periods presented. Your discussion should explain the nature of the expense and explain the extent to which such changes relate to volume and pricing and as it relates to your allocations, discuss whether there have been any changes to any of the specific allocations during the periods presented. Include similar revisions to your discussion of the operating results for the Commercial Services, International Card Service and Global Merchant and Network Services segments as well.

Response 5

We will enhance our tabular disclosures in MD&A in future filings to include quantification of individual components and changes in expenses at a segment level for (1) Card Member rewards, business development, Card Member services and marketing and (2) Salaries and employee benefits and other operating expenses. We believe this disaggregation provides the level of enhanced insight that most appropriately reflects the Company’s assessment of the expense categories that drive customer engagement versus operating expenses. An illustrative example attached as Exhibit II hereto includes this enhanced tabular disclosure for the USCS and CS segments, which we will provide in future filings. We will also provide similar tabular disclosure in future filings for the International Card Services and Global Merchant and Network Services segments. We will also continue to provide discussion explaining the nature of these expense components and describe material fluctuations in accordance with Item 303 of Regulation S-K.

On page 50 of the 2022 Form 10-K, we note in the expense discussion in the “Business Segment Results of Operations” section in MD&A that allocated expenses include service costs, which primarily reflect salaries and benefits associated with our technology and customer servicing groups, and overhead expenses. Service costs are allocated based on activities directly attributable to the segment, and overhead expenses are allocated based on the relative levels of revenue and Card Member loans and receivables in each segment. We will enhance our disclosure in future Annual Reports on Form 10-K, beginning with the 2023 Form 10-K, to further indicate that the proportion of allocated expenses to the overall operating expense base of the segment remains relatively consistent from period to period and the business drivers behind the allocation that are the primary factors contributing to any increased expense, as follows (2023 Form 10-K enhancements are in bold italics):

Salaries and employee benefits and other expenses reflect both costs incurred directly within each segment, as well as allocated expenses. The allocated expenses include service costs, which primarily reflect salaries and benefits associated with our technology and customer servicing groups and overhead expenses. Service and certain technology costs are allocated based on activities directly attributable to the segment, and overhead expenses are allocated based on the relative levels of revenue and Card Member loans and receivables. As a proportion of Salaries and employee benefits and other expenses, allocated costs remain relatively consistent from period to period.  Increases in expenses year-over-year driven by allocated costs primarily reflect the changes in salaries and employee benefit costs and other costs related to our technology or servicing organizations and the growth in business volume within our operating segments.

Securities and Exchange Commission

January 19, 2024

Page 6

Consolidated Capital Resources and Liquidity

Table 18: Summary of Customer Deposits and Consolidated Debt, page 23

Comment 6

Please revise, in future filings, to provide a discussion addressing the average interest rates paid on each of the different types of deposits held as well as addressing the reasons for the changes and the resulting impact on both interest expense and the liquidity needs of the company for each of the periods presented. Similar disclosures should be presented within the discussion of operating results for each of the identified segments.

Response 6

We will enhance our future filings, in the “Consolidated Capital Resources and Liquidity—Deposit Programs” section in MD&A, to provide the average interest rates paid on different types of deposits held in tabular format and discuss the changes from period to period and the impact on interest expense. An illustrative example attached as Exhibit III hereto includes this enhanced disclosure. Our liquidity needs are managed through a comprehensive strategy that includes, but is not limited to, maintaining diversified funding sources, including secured and unsecured term debt as well as deposits. We will discuss the impact of interest rates paid on deposits on our liquidity needs in future filings to the extent it is material.

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