American Express (AXP-N) raised its 2026 profit outlook on Friday, exceeding Wall Street expectations, after reporting strong third-quarter results. The credit card giant also announced plans to cut 5% of its global workforce as part of a restructuring effort. Airlines worldwide have been raising ticket prices due to surging fuel costs tied to the Middle East conflict, which contributed to a 13% jump in Amex’s airline spending segment.
The company’s travel and entertainment spending rose 10% in the third quarter compared to the same period last year, with a 9% increase in restaurant spending. Chief financial officer Christophe Le Caillec noted that higher airline ticket prices played a role in the segment’s growth. Amex’s billed business, a measure of total spending on all Amex-issued cards, increased 8% to US$454-billion, while revenue climbed 9% to US$20.1-billion.
Amex now expects full-year adjusted profit to range between US$17.60 and US$17.90 per share, with the midpoint surpassing estimates of US$17.63. The company has been investing heavily to attract younger consumers, particularly Gen Z and millennials, to build long-term customer relationships and expand its global market share. Despite beating earnings expectations with an adjusted profit of US$4.68 per share, the stock fell 1.3% in premarket trading.
Truist analyst Brian Foran noted that this would mark the ninth time in 11 quarters that Amex’s stock declined despite strong results, suggesting a potential disconnect between performance and investor sentiment.