Companies
American Express falls as job cut plans overshadow earnings beat
American Express beat third-quarter profit estimates and raised the low end of its full-year outlook, but its shares fell 3.7% on Friday after it announced global job cuts.
Quick Read
- American Express shares fell 3.7% on Friday, a loss of $8.1 billion in market value.
- The company topped third-quarter profit estimates and lifted the low end of its full-year outlook, but revenue came in slightly below forecasts.
- CEO Steve Squeri said the company plans global job cuts to reduce management layers and simplify operations.
- Rising expenses and a regulatory penalty drew attention, though management said the penalty would not change its 2026 guidance.
How far did American Express shares fall?
American Express (NYSE: AXP) shares fell 3.7% on Friday to close at $313.22. The card issuer lost $8.1 billion in market value on the day.
Why it matters: The drop left the stock 18.6% below its 52-week high of $384.89. A $1,000 stake bought a year ago would now be worth about $882.
By the numbers: The wider market was weaker too. The S&P 500 fell 0.5%, and the financial sector fund (XLF) slid 1.3%.
What did the company report?
Adjusted profit per share beat the consensus, the average analyst forecast that works as a bar to clear. Revenue after interest expense grew from a year earlier but came in slightly below the consensus.
The company said card members spent more, carried larger balances, and paid more in card fees. Travel and entertainment spending grew faster than overall spending.
American Express also raised the low end of its full-year guidance, the company's own forecast for its profit.
Why did the shares fall after a profit beat?
Chief Executive Steve Squeri said on Friday that the company plans to cut jobs across its global workforce. The company said the restructuring aims to remove management layers, simplify operations, and speed up decisions. It booked a restructuring charge in the quarter.
Costs also drew attention, according to reports. Total expenses rose, driven by spending tied to card member activity and a refresh of the U.S. Platinum Card. The company faces a regulatory penalty over anti-money-laundering shortcomings as well.
Management said the enforcement actions would not affect its 2026 guidance or its 2027 outlook. Credit quality offered a counterpoint. Provisions for credit losses declined from a year earlier. These are funds set aside for loans that may go unpaid. The rate of balances written off as unpaid also improved. A gain from selling its stake in Global Business Travel Group also lifted reported profit.
What comes next?
What’s next: Squeri pointed to continued strength in customer spending, new card sign-ups, keeping existing customers, and credit quality. The company also widened its premium card offerings through a partnership with Airbnb.
Upcoming data may give a read on the household spending that drives card volumes. The Conference Board's October consumer confidence index is due on Oct. 27 at 10 a.m. ET. The Federal Reserve announces its rate decision on Oct. 28 at 2 p.m. ET. September income and spending data follow on Oct. 29 at 8:30 a.m. ET.
For readers
What it could mean for you: People who own American Express shares directly carry the company's news in full, with no other holdings to soften it. For them, the open question may be whether the job cuts save enough to offset higher spending on rewards and the Platinum Card refresh. Management has said the regulatory penalty will not change its 2026 guidance. Future results could show whether card spending and credit quality hold up as the restructuring takes effect. That could shape how the shares trade from here.
Questions and answers
Why did American Express stock fall on Friday?
The shares fell 3.7% even though profit beat estimates. Reports pointed to the planned job cuts, rising expenses, a regulatory penalty, and revenue that came in slightly below analyst forecasts.
Did American Express beat third-quarter earnings estimates?
Yes. Adjusted profit per share beat the average analyst forecast, and the company raised the low end of its full-year outlook. Revenue grew from a year earlier but landed slightly below the consensus.
Is American Express cutting jobs?
Yes. CEO Steve Squeri said the company plans to cut jobs across its global workforce to remove management layers, simplify operations, and speed up decisions. The company recorded a restructuring charge tied to the plan.
The numbers
| American Express (AXP) price | $313.22 |
|---|---|
| American Express (AXP) change | −3.68% |
| American Express (AXP) market value | $210 billion |
| American Express (AXP) 52-week high | $384.89 |
| S&P 500 change | −0.52% |
| 10-year Treasury yield | 5.00% |
Friday’s close
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