Originally Posted by
findark
*2024 as an example, I provided maybe $3,500 in gross revenue to Amex from annual fees and interchange fees, and they bought me a $1,000 ticket (market value, not cost), paid me what will be $30/month plus $200/year in statement credits, paid for my lounge entry, and financed my Diamond status which if nothing else is giving me 4 RUCs, 4 GUCs, and another $700 statement credit.
$3,500 minus the annual fee is $2,850 of fees which divided by 0.03 (merchant fee rate) represents only $95,000 of spending on the AMEX card, which gets you a "boost" of 9,500 MQD's and a Head start of 2,500 MQD's. So you achieved DM flying Delta a lot (around $16k of actual DL spend) to get to the $28,000 MQD threshold.
From that $3,500, AMEX likely paid DL for your RDM's on that $95,000 of spend (around $950), a paltry fee for the MQD boosts, plus the cost of the statement credits, a few SC entry fees, and a discounted rate on that free ticket. AMEX is still profitable on you.
I think DL bears the brunt of the cost of giving DM benefits, which they currently value at the revenue received from AMEX for someone who charges $260,000 on the Reserve Card, but really wanted to value at $350,000 of charges based on the brief MQD threshold for DM that they floated out there in 2023 but walked back shortly after.