Reporting checked as of October 23, 2026, 12:10 p.m. ET. Educational market analysis, not financial advice.

Direct answer: American Express is cutting 5% of its global workforce and taking a $336 million pretax restructuring charge as it reorganizes work for wider use of artificial intelligence. AXP shares fell about 3% in morning trading even though adjusted profit beat expectations and the company raised full-year earnings guidance.

TL;DR

  • American Express said the workforce reduction will make the company leaner and prepare internal processes for AI.
  • Third-quarter revenue rose 9% to $20.062 billion, while adjusted earnings reached $4.68 per share.
  • The report carried mixed signals. Profit and guidance were stronger, but revenue came in slightly below the Wall Street estimate cited by CNBC.
  • The next useful read for traders is whether expense savings improve margins without weakening premium customer service or spending growth.

What happened with the American Express job cuts?

American Express CEO Stephen Squeri told analysts that the company would eliminate 5% of its global workforce. CNBC reported that the company had almost 77,000 employees at the end of 2025. Chief Financial Officer Christophe Le Caillec said the plan would reduce management layers, widen spans of control, and prepare processes for more automation.

The company recorded a $336 million pretax restructuring charge. After tax, the charge was $253 million, or $0.37 per share. The official release separates that charge from adjusted earnings, so traders should compare both GAAP and adjusted figures instead of relying on one headline number.

CNBC reported that adjusted earnings were $4.68 per share versus a $4.48 LSEG estimate. Revenue rose 9% from a year earlier to $20.062 billion, slightly below the $20.12 billion estimate cited by CNBC. Bloomberg also reported the workforce reduction alongside the earnings beat and higher guidance.

Why AXP stock fell after the earnings beat

AXP stock fell roughly 3% in morning trading because the release gave investors several competing inputs. Profit exceeded the consensus estimate, and billed business rose 8% to $454 billion. American Express also raised its full-year guidance to $18.30 to $18.60 in GAAP earnings per share and $17.60 to $17.90 on an adjusted basis.

Revenue was a little weaker than analysts expected, however, and the restructuring charge introduces execution risk. Investors must decide whether the cuts are a temporary cost reset or an early warning that expense pressure has become harder to contain.

Credit quality remained steady in the quarter. Provisions for credit losses fell to $1.0 billion from $1.3 billion a year earlier. The net write-off rate eased to 1.8% from 1.9%. Those figures reduce concern about an immediate credit shock, although future cardmember spending and delinquencies still matter for the financial sector.

Implications for stock and options traders

AXP equity traders: The debate centers on the quality of the guidance increase. Separate the recurring operating trend from the gain on the Global Business Travel Group stake sale and the one-time restructuring charge. Watch whether revenue growth and billed business remain firm after the reorganization begins.

Options traders: Earnings-day volatility can stay elevated when price reacts differently from the profit headline. Compare the post-report move with the implied move that was priced before earnings, then track whether shares hold the first-hour range. A fast reversal would suggest that the market is still sorting through the expense and AI strategy.

Financial-sector traders: American Express offers a read on premium consumer spending and credit quality. The company reported higher spending and card fees, while provisions declined. Weakness in those measures during later quarters would matter more than one day of price action.

Potential positives vs negatives

Potential positives

  • Adjusted earnings beat the Wall Street estimate cited by CNBC.
  • Full-year earnings guidance moved higher.
  • Billed business grew 8%, and the net write-off rate edged down.
  • A smaller management structure could lower costs if service levels hold.

Potential negatives

  • Revenue missed the cited estimate by a small amount.
  • The $336 million pretax charge shows that the reorganization carries a real upfront cost.
  • Workforce reductions can disrupt customer service and project delivery during the transition.
  • The AI plan remains an execution claim until future expense and productivity data show results.

An earnings-gap replay exercise for AXP

Use the next AXP replay to separate the earnings facts from the first price reaction. At the release timestamp, record adjusted EPS, revenue, billed-business growth, credit provisions, and the guidance range. Mark each item as better than expected, worse than expected, or difficult to compare because of one-time items.

Next, pause at the opening print and write down the premarket high, premarket low, and first 15-minute range. Do not assume the earnings beat should produce a gain. State which fact would justify the opening move and which fact would challenge it. Resume the replay only after setting an invalidation level and a maximum planned loss.

Compare the exercise with ChartDojo's guide to practicing news volatility with market replay. The same method also helps when reviewing the Volvo Cars post-earnings selloff, where price, guidance, and company-specific demand risks produced a much larger move.

What could happen from here

Base scenario: the market waits for proof

AXP trades around the earnings-day range while investors wait for later expense and spending data. Confirmation would come from stable revenue growth, continued cardmember spending, and clearer savings targets. A break from the range without new information would weaken the signal.

Upside scenario: savings support margins

The reorganization lowers the expense run rate while customer retention and spending remain firm. Future filings would need to show better operating efficiency without weaker service metrics. Rising expenses or slower billed-business growth would invalidate this scenario.

Downside scenario: revenue pressure becomes dominant

Slower revenue growth or weaker card spending outweighs the profit guidance. Confirmation would require softer billed business, higher delinquencies, or lower guidance in a later report. Stable credit and renewed revenue growth would challenge this path.

What traders should watch next

  • The final earnings-day range and whether AXP closes near its high or low.
  • Management details on timing, affected business units, and expected savings.
  • Changes in billed business, net interest income, and card fees next quarter.
  • Credit-loss provisions, net write-offs, and any shift in premium customer retention.

FAQ

How large is the American Express workforce reduction?

American Express said it will cut 5% of its global workforce. CNBC reported that the company employed almost 77,000 people at the end of 2025, but the company did not provide a final headcount for the reduction in its earnings release.

Why did AXP fall after beating profit estimates?

The report included a small revenue miss, a $336 million pretax restructuring charge, and uncertainty about execution. Those concerns competed with the earnings beat and higher full-year guidance.

Sources

Primary source: American Express Q3 2026 earnings release. Independent reporting: CNBC and Bloomberg. Feature-image licensing appears in the image caption.

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Header image: The historic American Express Company Building at 65 Broadway in New York. Photo by Beyond My Ken via Wikimedia Commons, CC BY-SA 4.0.