<p>High-net-worth households are holding up in an inflation-riddled environment that's making life difficult for everyone else.</p>
<p>That's the big takeaway from <strong>American Express</strong>' <span class="ticker-mention inline-flex items-center font-bold">(AXP <span class="ml-1 text-green-900">+1.37%</span>)</span> most recent quarterly earnings conference call, anyway. Without outright saying it, during the call, CFO Christophe Le Caillec commented: &#34;We expect card fee growth to pick up as the year progresses as we see the impact from the Platinum refresh, exiting the year in the high teens.&#34; He then added: &#34;Importantly, about one‑fourth of the overall U.S. consumer Platinum portfolio has been billed for the higher annual fee, and we have seen no change to our very high retention rates relative to pre‑refresh.&#34;</p>
<div><img alt="Person using credit card at beachside cafe." width="880" height="587" src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vZWRpdG9yaWFsL2ltYWdlcy84NzMyNjAvYWZmbHVlbnQtY29uc3VtZXItcGF5aW5nLWZvci1hLWx1eHVyeS1tZWFsLXdpdGgtYS1jcmVkaXQtY2FyZC5qcGcmdz0zODQw?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" original-src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vZWRpdG9yaWFsL2ltYWdlcy84NzMyNjAvYWZmbHVlbnQtY29uc3VtZXItcGF5aW5nLWZvci1hLWx1eHVyeS1tZWFsLXdpdGgtYS1jcmVkaXQtY2FyZC5qcGcmdz0zODQw"/>
<p>Image source: Getty Images.</p>
</div>
<p>Its fiscal results confirm this. The credit card company's currency-adjusted revenue improved 9% year over year for the three months ended in March on a comparable increase in transaction volume, driving net income 15% higher. Restaurant spending and retail spending were up 9% and 11%, respectively, with the latter led by a 18% year-over-year improvement in luxury retail purchases. Delinquencies and write-offs remain relatively low as well, not budging from year-ago levels.</p>
<section><div><div><div><small><div>Expand</div></small></div><div><img alt="American Express Stock Quote" width="64" height="64" src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vYXJ0L2NvbXBhbnlsb2dvcy9tYXJrL0FYUC5wbmcmdz0xMjg?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" original-src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vYXJ0L2NvbXBhbnlsb2dvcy9tYXJrL0FYUC5wbmcmdz0xMjg"/></div><div><h2>NYSE: AXP</h2><div>American Express</div></div></div><div><div><div>Today's Change</div><div>(1.37%) $4.63</div><div>Current Price</div><div>$342.41</div></div><div></div></div></div><div><div></div><div><h3>Key Data Points</h3><div><div>Market Cap</div><div>$230B</div><div>Day's Range</div><div>$336.04 - $344.47</div><div>52wk Range</div><div>$288.34 - $387.49</div><div>Volume</div><div>67.8K</div><div>Avg Vol</div><div>3.1M</div><div>Gross Margin</div><div>60.19%</div><div>Dividend Yield</div><div>1.01%</div></div></div></div></section>
<p>It's not just American Express seeing this resiliency among the affluent, either.</p><div><div id="foolcom_sidebar_top_container"><div><div><div></div><div></div><div></div></div></div><div></div></div></div>
<h2>Government reports seem to confirm American Express' findings</h2>
<p>The United States Federal Reserve typically focuses on domestic macroeconomics rather than fine, consumer-level details. In its most recent edition of the Beige Book published in May, however, the Fed made a point of addressing the current consumer-level divide. It acknowledged that over the course of the past few weeks, &#34;Higher-income consumers drove strong demand for premium goods and services, with one contact describing a focus on 'unapologetic luxury.' &#34; It then contrasted that with: &#34;However, retailers and other consumer-facing businesses noted continued financial stress among middle- and lower-income households.&#34;</p><div></div>
<p>In other words, the so-called K-shaped economic recovery is a real thing.</p><div><div id="in_line_article_pitch_container"><div><div><div><div></div></div><div><div></div><div></div><div></div></div></div></div><div></div></div></div>
<p>The Fed isn't the only organization to take notice of this dynamic, either. The National Association of Realtors and online real estate marketplace Redfin both report a surge in home purchases valued at $1 million-plus this year, despite the headwind the lower-priced segment of the real estate market is facing. Meanwhile, <strong>Bank of America</strong> reports that while all demographics spent more in May of this year than they did in May of last year, high-income households led the way, with a 5.4% increase versus just over a 4% increase for all other households.</p>
<p>Then again, why wouldn't this be the case? Although the roaring stock market theoretically benefits everyone, as The Motley Fool's in-house research highlights, the wealthiest 1% of the U.S. hold more than 40% of its total market value. The other 99% divvy up the rest, with the more affluent households among this 99% disproportionately owning most of this remainder. The bottom half collectively holds less than 2% of the U.S. stock market's total value.</p>
<h2>Great news for American Express</h2>
<p>So, yes, American Express' indirect suggestion is real -- while the majority of Americans may be financially frustrated at this time, the smaller crowd of affluent consumers truly is doing fine.</p>
<p>This, of course, bodes well for American Express, which has managed to turn more than its fair share of this crowd into cardholders, firming up its fiscal results for the foreseeable future. The stock's arguably well worth its premium price.</p><div id="article_pitch_container"><div><div><div></div><div></div><div></div><div></div><div></div><div></div><div></div></div></div><div></div></div><div id="promobox_container"><div><div><div></div><div></div><div></div><div></div></div></div><div></div></div>

<p>American Express reports strong Q1 results, driven by resilient affluent consumers despite broader economic stress. Revenue rose 9% and net income increased 15%, supported by luxury spending and high retention rates for its Platinum card. This aligns with Federal Reserve data highlighting a 'K-shaped' recovery where high-income households continue to drive demand for premium goods, while lower-income groups face financial strain. Consequently, Amex's focus on wealthy clients positions it well for future growth.</p>

- High-net-worth households are thriving amid inflation, contrasting with financial struggles faced by the majority.  
- American Express reported a 9% revenue increase and a 15% rise in net income, driven by luxury spending and high retention rates.  
- The Federal Reserve and other organizations have noted a K-shaped economic recovery, highlighting strong demand among affluent consumers for premium goods while lower-income groups continue to face financial stress.

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American Express Keeps Saying the Affluent Consumer Is Fine. Should Investors Trust It?