American Express (NYSE:AXP) reported third-quarter revenue of $20.1 billion, up 9% from a year earlier, as continued spending growth, rising card fees and strong credit performance supported results. The company raised its full-year earnings outlook while reaffirming its expectation for 10% revenue growth.
Chairman and Chief Executive Officer Steve Squeri said reported earnings per share were $5.42, while adjusted EPS was $4.68. The quarter included several discrete items, including a gain from the closing of the Global Business Travel transaction, a restructuring charge and legal reserve expense.
American Express increased its full-year 2026 reported EPS guidance to between $18.30 and $18.60, from its prior outlook, and set adjusted EPS guidance at $17.60 to $17.90. Squeri said the company remains on track for another year of 10% revenue growth and mid-teen EPS growth.
Global Business Travel Gain and Restructuring
The sale of American Express investments in Global Business Travel Group generated a gain of $1.11 per share during the quarter. The company used part of that gain to fund a $336 million restructuring charge, or $0.37 per share, that is expected to eliminate about 5% of its global positions.
Squeri said the restructuring is intended to streamline the organization, reduce management layers and speed decision-making as the company pursues growth and innovation initiatives. Excluding the Global Business Travel gain and restructuring charge, adjusted EPS totaled $4.68, up 13% year over year, according to Chief Financial Officer Christophe Le Caillec.
Adjusted results also included a $0.51-per-share increase in legal reserves, including the unreserved portion of a recently announced Office of the Comptroller of the Currency civil money penalty and a reserve for an anticipated settlement in an unrelated matter. A discrete tax benefit of $0.29 per share and a $0.24-per-share benefit related to CECL reserve-model updates offset those items, Le Caillec said.
Squeri said the OCC orders do not impose an asset cap on the company. He added that the costs associated with remediation are not expected to affect American Express’ 2027 guidance, though he said the deficiencies cited in the consent order should not have occurred.
Spending, Fees and Credit Trends
Overall billed business rose 8% during the quarter, consistent with the prior four quarters. Goods and services spending increased 7%, while travel and entertainment spending rose 10%. Airline spending increased 13%, restaurant spending rose 9%, and U.S. consumer spending grew 9.4%.
Le Caillec said the quarter included an approximately 60-basis-point year-over-year effect from co-brand exits, including the sale of the Amazon co-brand portfolio midway through the period. He also cited the timing of Amazon Prime Day and other promotional retail events as a factor affecting sequential spending comparisons.
Commercial spending rose 3%, or 5% excluding co-brand portfolio exits, while international spend increased 11%. Merchant coverage reached more than 190 million locations globally, compared with 160 million a year earlier. American Express acquired 3.1 million new cards in the quarter, with 76% of new accounts on fee-paying products.
Net card fees increased 17% on an FX-adjusted basis, remaining the company’s fastest-growing revenue line. Le Caillec said the growth reflected strong results from the U.S. Platinum card refresh. One year after the refresh, spend retention for the U.S. Consumer Platinum portfolio stood at 99%.
Total cardmember balances grew 8%, while net interest income increased 10%. Write-off dollars rose 3%, and the delinquency rate remained between 1.2% and 1.3% for the 15th consecutive quarter. Provision expense was $985 million, including a $211 million reserve release driven by CECL model enhancements.
Investment, Returns and Customer Offerings
Marketing expense increased 11% as American Express stepped up customer-acquisition investments following strong first-half performance. The value-creating expense-to-revenue ratio was 44.3%, and Le Caillec said growth in cardmember services expenses should moderate significantly in the fourth quarter as the company laps the Platinum refresh.
American Express returned $2.2 billion of capital to shareholders in the third quarter, including $1.6 billion of share repurchases and $600 million in dividends. Its CET1 ratio ended the quarter at 10.9%.
The company also highlighted new products and partnerships, including an exclusive Airbnb agreement that will bring more than 1 million listings globally into Amex Travel and expand travel benefits for eligible U.S. card members. American Express also cited its Corporate Cashback Card, integrated expense-management capabilities and Business Savings account as initiatives designed to build engagement among business customers.
AI Strategy Focuses on Membership and Payments
Squeri said American Express is using artificial intelligence to improve productivity and internal processes, but emphasized that the company sees AI as a way to make card membership more personalized and valuable. The company is focusing on AI applications across value propositions, customer acquisition, engagement, payments and service.
Examples include the Resy Restaurant Discovery and Reservations experience in ChatGPT, work with OpenAI on an Amex plugin for discovering and enrolling in Amex Offers, and the company’s AI-enabled travel Wishlist Builder. Through a partnership with Perplexity, eligible business card members can access Amex-curated AI tools for activities such as cash-flow forecasting and marketing campaigns.
For agent-driven payments, American Express is developing tools intended to authenticate agents, verify customer authorization and preserve transaction context. Squeri said the company plans to take a risk-based approach to AI-agent access and will not allow assistants to operate freely through its systems.
“Our customer remains the card member,” Squeri said, adding that the company’s objective is to extend American Express protections, service and membership benefits into AI-powered experiences.
About American Express (NYSE:AXP)
American Express Company is a global financial services company that provides payment, lending, travel and expense management products and services. Its offerings include consumer and small-business charge and credit cards, corporate payment programs, business financing solutions, deposit products and digital payment services.
The company operates an integrated payments network that connects card members, merchants and financial institutions. American Express also provides merchant acquisition and payment processing services, data and analytics, fraud prevention tools, and customer loyalty programs.
