Amex Plans To Eliminate About 5% Of Positions, Using Part Of Its Business Travel Gain
CEO Steve Squeri said a $336 million restructuring charge is meant to flatten layers, and the OCC penalty leaves 2026 guidance intact.
American Express expects its $336 million restructuring charge to eliminate approximately 5% of its positions worldwide, CEO Steve Squeri said on the company's third-quarter earnings call Friday. The company is paying for it with part of the gain from selling its stake in its global business travel venture.
A bigger restructuring than usual
Squeri, who is chairman and CEO, said the charge is somewhat larger than what Amex typically takes. Earlier this year, he said, he asked senior leaders to streamline their organizations, focus teams on the most critical deliverables and cut layers to speed decisions.
The company is dropping two-thirds of the business travel gain to the bottom line, Squeri said, and using the rest to invest and become more efficient. Chief Financial Officer Christophe Le Caillec put the gain at $1.11 per share and the restructuring charge at $0.37 per share.
Amex, which issues credit and charge cards, runs a payments network and signs up the merchants that accept its cards, reported EPS of $5.42, up 31%. Adjusted EPS was $4.68, up 13% from a year earlier, on revenue of $20.1 billion, up 9%.
The OCC penalty and guidance
Adjusted EPS includes a $0.51 increase in legal reserves, Le Caillec said. That covers the unreserved part of the civil money penalty from the OCC, the national bank regulator, plus a reserve for an anticipated settlement of an unrelated matter.
Squeri said the penalty does not affect 2026 guidance and the orders impose no asset cap. Remediation costs are not anticipated to affect 2027 guidance. The deficiencies cited in the consent order "should not have occurred," he said, and Amex is accountable for addressing them.
Amex reaffirmed revenue growth guidance of 10% and raised EPS guidance to $18.30 to $18.60 on a reported basis, or $17.60 to $17.90 adjusted.
Capital and the quarter ahead
Amex ended the quarter with a common equity tier 1 capital ratio of 10.9%, which Le Caillec said reflected the gain from the stake sale at quarter-end. It returned $2.2 billion to shareholders in the quarter, $1.6 billion of buybacks and $0.6 billion of dividends.
Le Caillec said growth in card member services expenses, which include rewards, should moderate significantly in the fourth quarter as the Platinum Card refresh is fully absorbed. Net card fees rose 17% on a currency-adjusted basis.
Le Caillec said 2027 guidance will come in January.
Sources
- American Express profit jumps as customers stick with the $895 Platinum Card — Associated Press
- American Express raises annual profit outlook as affluent customers keep spending - The Globe and Mail — Reuters
- American Express Q3 earnings beat as network volume disappoints (AXP:NYSE) | Seeking Alpha — seekingalpha.com
- American Express Non-GAAP EPS of $4.68 beats by $0.19, revenue of $20.06B misses by $60M (NYSE:AXP) | Seeking Alpha — seekingalpha.com
- American Express Reports Third-Quarter 2026 Financial Results – Company Announcement - FT.com — Financial Times
