By Paul Goldberg – Senior Correspondent | Business Finance News
NEW YORK, NY — (October 26, 2026) — American Express (AXP) is delivering stronger quarterly earnings and higher spending among its affluent cardholders, but the financial services giant is also preparing a significant workforce reduction that could eliminate approximately 3,500 positions.
The company reported third-quarter net income of $3.71 billion, representing a 28% increase from the previous year. Earnings reached $5.42 per share, while adjusted earnings of $4.68 per share, excluding a one-time investment-related gain, exceeded Wall Street expectations.
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Despite the improved financial performance, American Express plans to reduce its workforce by approximately 5%, marking one of its most substantial rounds of job cuts in roughly a decade.
Higher Platinum Card Fees Strengthen American Express Revenue
A major contributor to American Express’ financial performance has been its revamped Platinum Card, which now carries an $895 annual fee, up from $695.
The $200 increase raised questions about whether premium cardholders would continue paying for membership. According to the company, nearly all customers transitioned to the higher-priced product have retained their cards.
Net card fee revenue increased by more than $400 million compared with the same quarter a year earlier, underscoring the financial importance of premium membership programs.
American Express also reported continued growth in cardholder activity.
Average customer spending reached $6,735 for the quarter, an increase of 5% year over year. Travel and entertainment spending climbed 10%, while airline ticket spending increased 13%.
Company executives acknowledged that inflation contributed to some of the higher transaction values, although increased card usage also supported spending growth.
Why Is American Express Cutting 3,500 Jobs Despite Rising Profits?
The planned workforce reduction highlights an increasingly visible corporate strategy: improving operational efficiency even when earnings remain strong.
American Express CEO Steve Squeri characterized the layoffs as an effort to streamline operations rather than a response to deteriorating business conditions.
The company has faced rising expenses as major financial institutions compete for premium customers through travel benefits, loyalty rewards, and exclusive cardholder services.
Competitors including JPMorgan Chase and Capital One have intensified that competition, placing additional pressure on the economics of high-end credit card programs.
For investors, the workforce reduction signals management’s intention to control expenses while continuing to invest in premium customer acquisition and retention.
For employees, however, the announcement introduces uncertainty at a company reporting substantial profit growth.
American Express Raises Its Full-Year Earnings Outlook
Following the quarterly results, American Express increased the lower end of its full-year adjusted earnings forecast.
The company now expects adjusted earnings of $17.60 to $17.90 per share, compared with its previous projection of $17.30 to $17.90.
The improved outlook reflects continued confidence in cardholder spending, premium membership revenue, and the company’s broader financial performance.
Yet the simultaneous announcement of thousands of layoffs raises a larger question for corporate America: how companies balance shareholder expectations, operational efficiency, and employment stability during periods of strong profitability.
For business leaders and financial market observers, American Express offers another example of how rising revenue and workforce reductions can occur at the same time.
JRL CHARTS LGBT Business Finance News continues reporting on corporate earnings, financial markets, employment trends, and business developments shaping the American economy.
His reporting focuses on federal court rulings, legislative developments, international human rights issues, and government actions impacting LGBTQ communities worldwide.
With nearly two decades of experience, Goldberg is recognized for his balanced analysis, investigative insight, and commitment to accurate, fact-based journalism that informs readers on the political forces shaping equality and justice.
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