American Express Lifts 2026 EPS Guidance To $18.30-$18.60 After A One-Time Gain Flatters The Quarter
Reported third-quarter earnings per share rose 31%, but adjusted EPS grew 13% once a $982 million pre-tax stake-sale gain is stripped out.
American Express raised its full-year 2026 earnings-per-share outlook to $18.30 to $18.60, or $17.60 to $17.90 adjusted, after third-quarter revenue net of interest expense rose 9% to $20.1 billion. The headline 31% jump in quarterly EPS leans on a one-time gain from selling its Global Business Travel Group stake, which the company excludes from its 13% adjusted growth.
Reported versus adjusted growth
American Express, which issues credit, charge and debit cards and runs a payments network, said in an 8-K filed Friday that net income rose 28% to $3.7 billion, or $5.42 a share, up 31% from $4.14 a year earlier.
Adjusted EPS was $4.68, up 13%. That strips out a $982 million pre-tax gain ($751 million after tax) on the previously announced sale of its Global Business Travel Group stake, net of a $336 million pre-tax restructuring charge tied to efficiency initiatives. Adjusted net income was $3.2 billion.
The adjusted guidance range of $17.60 to $17.90 excludes the same gain, net of the restructuring charge. CEO Stephen J. Squeri said the company is "on track to deliver another year of 10 percent revenue growth."
Credit costs fell, taxes dropped
Provisions for credit losses fell to $1.0 billion from $1.3 billion a year earlier, because the company released reserves this quarter after building them in the prior-year period. Higher net write-offs partly offset that. The net write-off rate on principal losses was 1.8%, down from 1.9%.
The effective tax rate fell to 18.1% from 24.1%, mainly on discrete tax benefits from resolving prior-period tax items, the company said. Expenses rose 9% to $14.5 billion, driven by higher variable customer engagement costs from card spending and the U.S. Platinum Card refresh.
Billed business reached $454.0 billion, up 8%. Revenue growth came from higher card spending, net interest income and card fees.
The stock and the call
AXP shares closed Thursday at $325.17, up 0.48%, before the results came out Friday.
American Express holds an investor call at 8:30 a.m. ET Friday to discuss the quarter and the raised outlook.
The company's 2026 guidance now carries two EPS ranges, and the gap between them is the Global Business Travel Group gain.
Sources
- 8-K Filing — AMERICAN EXPRESS CO (AXP) — SEC EDGAR
- Exhibit q326exhibit991.htm — AMERICAN EXPRESS CO 8-K exhibit — SEC EDGAR
- Exhibit q326exhibit992.htm — AMERICAN EXPRESS CO 8-K exhibit — SEC EDGAR
