Reportable Operating Segments and Geographic Operations

12 Months Ended

Dec. 31, 2022

Segment Reporting [Abstract]

Reportable Operating Segments and Geographic Operations

REPORTABLE OPERATING SEGMENTS AND GEOGRAPHIC OPERATIONS

REPORTABLE OPERATING SEGMENTS

We consider a combination of factors when evaluating the composition of our reportable operating segments, including the results reviewed by the chief operating decision maker, economic characteristics, products and services offered, classes of customers, product distribution channels, geographic considerations (primarily United States versus outside the United States), and regulatory environment considerations.

Effective for the first quarter of 2022, we updated the methodology used to allocate certain revenues; prior period amounts have been recast to conform to current period presentation.

Effective for the third quarter of 2022, we realigned our reportable segments to reflect organizational changes announced during the second quarter of 2022. Prior periods have been recast to conform to the new reportable operating segments.

The following is a brief description of the primary business activities of our four new reportable operating segments:

•U.S. Consumer Services (USCS), which issues a wide range of proprietary consumer cards and provides services to U.S. consumers, including travel and lifestyle services as well as banking and non-card financing products.

•Commercial Services (CS), which issues a wide range of proprietary corporate and small business cards and provides services to U.S. businesses, including payment and expense management, banking and non-card financing products. CS also issues proprietary corporate cards and provides services to select global corporate clients.

•International Card Services (ICS), which issues a wide range of proprietary consumer, small business and corporate cards outside the United States. ICS also provides services to our international customers, including travel and lifestyle services, and manages certain international joint ventures and our loyalty coalition businesses.

•Global Merchant and Network Services (GMNS), which operates a global payments network that processes and settles card transactions, acquires merchants and provides multi-channel marketing programs and capabilities, services and data analytics, leveraging our global integrated network. GMNS manages our partnership relationships with third-party card issuers (including our network partnership agreements in China), merchant acquirers and a prepaid reloadable and gift card program manager, licensing the American Express brand and extending the reach of the global network.

Corporate functions and certain other businesses and operations are included in Corporate & Other.

The following table presents certain selected financial information for our reportable operating segments and Corporate & Other as of or for the years ended December 31, 2022, 2021 and 2020:

(Millions, except where indicated)	USCS		CS		ICS		GMNS		Corporate & Other (a)		Consolidated
2022
Total non-interest revenues	$	16,440	$	12,196	$	8,262	$	6,123	$	(54)	$	42,967
Revenue from contracts with customers (b)	12,478		10,844		5,301		5,603		(7)		34,219
Interest income	8,457		2,070		1,453		23		655		12,658
Interest expense	983		697		654		(329)		758		2,763
Total revenues net of interest expense	23,914		13,569		9,061		6,475		(157)		52,862
Pretax income (loss)	5,400		2,880		578		2,954		(2,227)		9,585
Total assets (billions)	$	94	$	51	$	37	$	20	$	26	$	228
2021
Total non-interest revenues	$	12,989	$	9,833	$	6,761	$	5,021	$	26	$	34,630
Revenue from contracts with customers (b)	9,823		8,659		4,368		4,694		172		27,716
Interest income	6,328		1,408		1,116		16		165		9,033
Interest expense	395		330		442		(92)		208		1,283
Total revenues net of interest expense	18,922		10,911		7,435		5,129		(17)		42,380
Pretax income (loss)	5,958		2,936		929		1,874		(1,008)		10,689
Total assets (billions)	$	77	$	45	$	33	$	15	$	19	$	189
2020
Total non-interest revenues	$	10,125	$	8,210	$	5,877	$	4,209	$	(319)	$	28,102
Revenue from contracts with customers (b)	7,261		7,123		3,663		3,948		(21)		21,974
Interest income	7,009		1,532		1,244		18		280		10,083
Interest expense	787		508		379		(82)		506		2,098
Total revenues net of interest expense	16,347		9,234		6,742		4,309		(545)		36,087
Pretax income (loss)	3,103		1,013		521		1,294		(1,635)		4,296
Total assets (billions)	$	65	$	35	$	28	$	14	$	49	$	191

(a)Corporate & Other includes adjustments and eliminations for intersegment activity.

(b)Includes discount revenue, certain service fees and other revenue and processed revenues from customers.

Total Revenues Net of Interest Expense

We allocate discount revenue and certain other revenues among segments using a transfer pricing methodology. Within the USCS, CS and ICS segments, discount revenue generally reflects the issuer component of the overall discount revenue generated by each segment’s Card Members; within the GMNS segment, discount revenue generally reflects the network and acquirer component of the overall discount revenue being allocated.

Net card fees, processed revenue and certain other revenues are directly attributable to the segment in which they are reported.

Interest and fees on loans and certain investment income is directly attributable to the segment in which it is reported. Interest expense represents an allocated funding cost based on a combination of segment funding requirements and internal funding rates.

Provisions for Credit Losses

The provisions for credit losses are directly attributable to the segment in which they are reported.

Expenses

Card Member rewards and Card Member services expenses are included in each segment based on the actual expenses incurred. Business development and Marketing expenses are included in each segment based on the actual expenses incurred. Global brand advertising is primarily allocated to the segments based on the relative levels of revenue.

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 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.

GEOGRAPHIC OPERATIONS

The following table presents our total revenues net of interest expense and pretax income (loss) from continuing operations in different geographic regions based, in part, upon internal allocations, which necessarily involve management’s judgment.

Effective for the first quarter of 2022, we changed the way in which we allocate certain overhead expenses by geographic region. As a result, prior period pretax income (loss) from continuing operations by geography has been recast to conform to current period presentation; there was no impact at a consolidated level.

(Millions)	United States		EMEA(a)		APAC(a)		LACC(a)		Other Unallocated(b)		Consolidated
2022
Total revenues net of interest expense	$	41,396	$	4,871	$	3,835	$	2,917	$	(157)	$	52,862
Pretax income (loss) from continuing operations	10,383		550		376		500		(2,224)		9,585
2021
Total revenues net of interest expense	$	33,103	$	3,643	$	3,418	$	2,238	$	(22)	$	42,380
Pretax income (loss) from continuing operations	10,325		460		420		494		(1,010)		10,689
2020
Total revenues net of interest expense	$	28,263	$	3,087	$	3,271	$	2,019	$	(553)	$	36,087
Pretax income (loss) from continuing operations	5,422		187		328		273		(1,914)		4,296

(a)EMEA represents Europe, the Middle East and Africa; APAC represents Asia Pacific, Australia and New Zealand; and LACC represents Latin America, Canada and the Caribbean.

(b)Other Unallocated includes net costs which are not directly allocated to specific geographic regions, including costs related to the net negative interest spread on excess liquidity funding and executive office operations expenses.