Amex Says New Customers Are Flocking to Its Pricey New Platinum Card

Not even multi-hundred-dollar fee hikes have stifled the consumer appetite for elite credit cards.

American Express executives said that early demand for its revamped Platinum card beat their expectations on Friday’s third-quarter earnings call.

“New Platinum account acquisitions are running at twice the level before the refresh,” CEO Stephen Squeri said on the company’s third-quarter earnings call on Friday. So far, he said it’s the “strongest start” the company has seen for a US Platinum refresh (this is the third in the last decade).

Amex unveiled its new Platinum card in September, which has an annual fee of $895. Squeri said that retention rates for existing cardholders “have been stable post refresh,” adding that the $200 price hike won’t go into effect for them for a few months.

As the luxury credit card wars have heated up — Chase upped its Sapphire Reserve fee and Citi introduced its Strata Elite card this summer — some have grumbled over the ever-climbing fees. According to JPMorgan Chase CFO Jeremy Barnum, however, they’re not having any trouble convincing people to pay the now $795 fee for its refreshed card.

“This has already been the best year ever for new account acquisitions for our Sapphire portfolio,” he said on Chase’s third-quarter earnings call on Tuesday.

For Amex, the Platinum perks “appeal broadly across generations, including millennial and Gen Z consumers,” Squeri said on Friday. He added that they seem to especially appreciate the wellness and entertainment bonuses.

Young cardholders have become a key Amex customer in recent years. In the first quarter of last year, the company said millennials and Gen Zers made up 75% of its new platinum and gold accounts.

Squeri also said in an interview last year that the company used to target millennials and Gen Zers with no-fee cards, but has since tried to woo them with fancier and more expensive ones. This quarter, millennial and Gen Z consumers across Amex cards tended to complete about 25% more transactions than older cohorts, CFO Christophe Le Caillec said on Friday’s call.

Amex reported $421 billion in billed business — the value of transactions on Amex products — during the third quarter. The company’s stock was up more than 7% by mid-afternoon on Friday.