American Express is cutting 5% of its workforce as CEO Steve Squeri looks to keep a lid on rising costs. He told Bloomberg TV the firm has 78,000 employees, putting the reduction at roughly 3,500 jobs.
On Friday's analyst call, Squeri said the goal is to make Amex more agile and efficient by trimming layers and speeding decisions. Speaking about the contest for premium customers, he said, "It's been highly competitive," and added, "And our assumption is that it will remain highly competitive."
The move tracks with broader finance layoffs. Barclays said this week it would eliminate 5,000 jobs, HSBC is planning reductions in its UK wealth business, and Citigroup has also been lowering headcount.
Amex has been spending to defend its premium franchise. It refreshed select cards and added a slew of new Platinum perks last year, and earlier this month said certain luxury Airbnb rentals booked on its travel site will qualify for the cardholders' annual lodging credit.
Those sweeteners are not cheap. Total expenses climbed about 9% in Q3 to $14.5 billion, better than the $14.8 billion analyst estimate. Member rewards costs rose 10% and marketing was up 11%. Earlier, Chief Financial Officer Christophe Le Caillec said marketing spend would be roughly 10% above last year during the back half of 2026.
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Earnings beat. Adjusted EPS came in at $4.68, above the $4.49 average estimate in a Bloomberg survey. Amex also raised its 2026 EPS outlook to $18.30 to $18.60 from $17.30 to $17.90.
Spending trends were a touch light. Billed business was $454 billion in Q3, just under the $456.9 billion consensus, with the company noting it exited some small business co-brand deals that affected results. "The details are more mixed."
Amex recorded an after-tax gain of $751 million from divesting its stake in Global Business Travel Group Inc. A portion of that was applied to a $253 million after-tax restructuring charge aimed at efficiency initiatives. After offsetting for the restructuring, the gain is left out of the adjusted results.
By Friday at 9:35 a.m. in New York, the shares were down 1.8% to $319.45, extending the year-to-date decline to nearly 14%. Squeri said, "Our business momentum continues, with strength in billings, new acquisitions and card member retention, and excellent credit quality."
Amex faces a $350 million penalty tied to anti money laundering violations after actions by the OCC and the Federal Reserve earlier this month. The company said the penalty leaves its previously issued full year 2026 guidance unchanged, does not alter any 2027 outlook, and that the orders stop short of imposing an asset cap.
In plain English: Amex is trimming staff to protect margins while paying up to keep premium cardholders, posting an earnings beat and a higher long term outlook even as billed business undershot. The bottom line for portfolios is whether cost cuts and efficiency moves show up in run rate expenses while spending growth steadies.
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