American Express raises 2026 EPS guidance as third-quarter EPS rises 31% to $5.42

American Express Company (AXP) said Friday it earned $5.42 per diluted share in the third quarter of 2026, up 31% from $4.14 a year earlier, and raised its full-year EPS guidance.

Net income was $3.7 billion, compared with $2.9 billion a year earlier, according to a Form 8-K filed Friday. Results include a $982 million pre-tax gain from the sale of the company's equity interest in Global Business Travel Group, Inc. (GBTG).

Excluding the gain and a restructuring charge, adjusted diluted EPS was $4.68, up 13% from a year earlier. Adjusted EPS is a non-GAAP measure, meaning it is not calculated under generally accepted accounting principles.

Here's how the company did:

• Diluted EPS: $5.42 vs. $4.14 a year earlier
• Adjusted diluted EPS: $4.68 vs. $4.14 a year earlier
• Revenue net of interest expense: $20.06 billion vs. $18.43 billion a year earlier
• Net income: $3.71 billion vs. $2.90 billion a year earlier
• Adjusted net income: $3.21 billion vs. $2.90 billion a year earlier

Revenue rose 9% from a year earlier. Sequentially, it was up from $19.64 billion in the second quarter.

The increase was primarily driven by higher Card Member spending, increased net interest income supported by growth in card balances, and card fee growth.

Here's how other American Express segments did during the quarter:

• U.S. Consumer Services: revenue $9.84 billion, up 11%
• Commercial Services: revenue $4.55 billion, up 6%
• International Card Services: revenue $3.68 billion, up 10%
• Global Merchant and Network Services: revenue $2.08 billion, up 6%

Pretax income at U.S. Consumer Services rose 24% to $2.3 billion.

The company raised its full-year 2026 EPS guidance to between $18.30 and $18.60, or $17.60 to $17.90 on an adjusted basis. The filing does not give the previous range.

Chairman and Chief Executive Officer Stephen J. Squeri said the company is "on track to deliver another year of 10 percent revenue growth."

Squeri said the company's progress gives him "great confidence in our ability to deliver differentiated value for our customers and strong returns for our shareholders over the long term."

Provisions for credit losses were $1.0 billion, compared with $1.3 billion a year ago. The company said the decrease reflected a reserve release this quarter, compared with a reserve build in the prior year, partly offset by higher net write-offs.

The net write-off rate was 1.8%, down from 1.9%.

Expenses were $14.5 billion, up 9% from a year earlier. The company said the increase was primarily driven by higher variable customer engagement costs from increased Card Member spending and the U.S. Platinum Card refresh, partly offset by lower operating expenses.

The effective tax rate was 18.1%, down from 24.1%, mainly from discrete tax benefits tied to the resolution of certain prior-period tax items.

The company recorded a $336 million pre-tax restructuring charge tied to efficiency initiatives and excluded it from adjusted results.

Billed business was $454.0 billion, up 8% from a year earlier, and network volumes reached $517.9 billion, also up 8%. Total Card balances were $221.1 billion, up 7%.

The company declared cash dividends of $0.95 per common share, up from $0.82 a year earlier, and repurchased 5 million common shares during the quarter. The Common Equity Tier 1 ratio was 10.9%, up from 10.5% a year earlier.

In August, the company issued $1.6 billion of 6.450% Fixed Rate Reset Noncumulative Preferred Shares, Series E, aug. 12, 2026. It used the proceeds to redeem its $1.6 billion of 3.550% Series D preferred shares on Sept. 15, 2026. The redemption reduced net income available to common shareholders by $16 million.

The company said it launched the next generation of Amex Corporate, with new integrated expense management software and an Amex Expense mobile app, and introduced a new American Express Business Savings account.

It extended its long-term strategic partnership with Marriott International, including the U.S. cobrand cards. It also launched an exclusive partnership with Airbnb, bringing over one million listings globally to Amex Travel.

Card acceptance reached more than 190 million merchant locations worldwide. The company opened its newest Centurion Lounge at Amsterdam Airport Schiphol, bringing the total to 33 locations, and said a new 30,000-square-foot lounge at Newark Liberty International Airport is its largest to date.

American Express also ranked No. 1 issuer in the JD Power 2026 U.S. Credit Card Satisfaction Study for the seventh consecutive year.