American Express Company AXP raised its 2026 earnings guidance during its third-quarter earnings call, supported by resilient premium customer spending, accelerating card fee growth and stable credit quality.
Management also outlined its artificial intelligence strategy, restructuring plans and competitive priorities, while analysts questioned the potential impact of AI-driven rewards optimization and rising competition in premium cards.
AXP Raises Earnings Outlook Amid Revenue Growth
American Express raised its full-year 2026 reported earnings per share (EPS) guidance to $18.30-$18.60 and adjusted guidance to $17.60-$17.90. Revenue growth guidance remained unchanged at 10%.
Chairman and CEO Stephen Squeri attributed the improved outlook to sustained business momentum and strong customer engagement. CFO Christophe Le Caillec also emphasized disciplined expenses and consistent credit performance.
Adjusted quarterly earnings of $4.68 per share exceeded the Zacks Consensus Estimate of $4.47. Revenues of $20.06 billion missed the consensus estimate of $20.13 billion, despite increasing 9% year over year.
American Express Company Price, Consensus and EPS Surprise
American Express Company price-consensus-eps-surprise-chart | American Express Company Quote
Amex Sees Resilient Premium Customer Spending
Le Caillec highlighted an 8% increase in billed business, reflecting continued spending strength despite the impact of co-brand portfolio exits.
U.S. consumer spending increased 9.4%, while travel and entertainment spending advanced 10%. Airline spending climbed 13%, and restaurant spending grew 9%.
International spending increased 11%, marking 22 consecutive quarters of double-digit growth. Management emphasized that premium customers continued demonstrating consistent engagement and spending patterns.
AXP Benefits From Accelerating Card Fee Growth
Net card fees grew 17% on a foreign exchange-adjusted basis, accelerating from 15% in the preceding quarter.
Le Caillec linked the improvement to the U.S. Platinum Card refresh and continued demand for premium products. The company acquired 3.1 million new cards, with 76% of new accounts carrying fees.
Management also highlighted stable lending fundamentals. Card balances increased 8%, while net interest income grew 10%. The net write-off rate declined to 1.8% from 1.9% a year earlier.
Amex Expands AI Across Its Membership Model
Squeri identified five areas for AI integration: customer value propositions, acquisition, engagement, payments and servicing.
The company is expanding its OpenAI collaboration, including plans for an Amex plug-in enabling card members to discover and enroll in offers. Its agentic commerce initiatives also focus on transaction authentication and customer protection.
During the Q&A, analysts from KBW and UBS questioned whether AI-powered rewards optimization could increase benefit expenses. Squeri emphasized controlled agent access, spending thresholds and the company's broader membership benefits. He acknowledged that determining the financial impact on customer engagement expenses remains premature.
AXP Targets Efficiency Through Restructuring
American Express recorded a $336 million restructuring charge, with plans to eliminate approximately 5% of its global positions.
Squeri explained that the initiative aims to simplify organizational structures, accelerate decisions and create additional investment capacity.
Le Caillec expects variable customer engagement expense growth to moderate significantly in the fourth quarter as the company laps the Platinum refresh. Management also addressed regulatory deficiencies and associated legal reserves, emphasizing remediation and stronger controls without changing its earnings outlook.
Amex Addresses Competition in Premium and Commercial Cards
During the Q&A session, analysts from Wells Fargo and Piper Sandler questioned intensifying competition for premium customers.
Squeri maintained that competition remains consistent with historical trends. He emphasized American Express' differentiated revenue model, combining customer spending, card fees and lending.
In commercial payments, management acknowledged weaker middle-market growth. The Center acquisition, Corporate Cashback Cards and integrated expense management capabilities are intended to strengthen competition against Ramp and Brex.
AXP Maintains Focus on Long-Term Execution
Management's commentary reflected confidence in premium customer engagement, disciplined underwriting and sustained investment in membership differentiation.
While restructuring and regulatory remediation remain priorities, executives emphasized expanding AI capabilities, improving efficiency and maintaining long-term earnings growth.
What AXP's Zacks Rank and Style Scores Indicate
American Express currently carries a Zacks Rank #3 (Hold), indicating a neutral near-term earnings estimate revision outlook. Its Value Score of C reflects middling value characteristics, while its Growth Score of D and Momentum Score of F indicate weaker positioning across those investment styles.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The stock's VGM Score of D reflects an unfavorable combined assessment of value, growth and momentum characteristics. Zacks' framework generally favors stocks with a Zacks Rank #1 or 2 (Buy) and Style Scores of A or B. AXP's current combination offers less favorable screening characteristics, although its Zacks Rank can change as analysts revise earnings estimates following the latest results.
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