Global payments company American Express (NYSE: AXP) missed Wall Street’s revenue expectations in Q3 2026, but sales rose 15.3% year on year to $19.75 billion. Its non-GAAP profit of $4.68 per share was 4.3% above analysts’ consensus estimates.

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StockStory’s take

American Express delivered revenue broadly in line with Wall Street expectations and a GAAP profit that exceeded consensus in the third quarter. Management attributed the quarter’s performance to continued strength in its premium cardmember base, robust travel and entertainment spending, and higher net card fees. CEO Steve Squeri acknowledged the impact of a restructuring charge and legal expenses, including a civil penalty from regulators, stating, “the deficiencies cited in the consent order should not have occurred, and we are accountable for addressing them thoroughly.”

Looking ahead, American Express’s guidance is anchored by ongoing investments in technology and marketing, with a particular focus on leveraging artificial intelligence (AI) to enhance membership value and operational efficiency. Management expects AI to drive greater personalization for cardmembers and improve service delivery, while also keeping a close eye on evolving customer behaviors and regulatory developments. CEO Squeri emphasized, “AI gives us the opportunity to make Amex membership even more valuable,” while cautioning that the company will take a risk-based approach to integrating AI platforms and agents.

Key insights from management’s remarks

Management attributed Q3 results to strong premium customer engagement, robust travel and entertainment spend, and continued investment in digital and AI-driven initiatives.

• Premium customer momentum: U.S. consumer spending grew 9.4%, with management citing high retention rates and the success of refreshed premium card offerings, such as the Platinum card and associated travel benefits.
• Travel and dining spend surge: Travel and entertainment (T&E) categories saw double-digit growth, with airline spend up 13% and restaurant spend up 9%. Proprietary platforms like Resy contributed, with Resy-enabled restaurant spend up 18% and Fine Hotels + Resorts up 50%.
• Card fee acceleration: Net card fees rose 17% year-over-year, driven by a higher mix of fee-paying premium products and strong customer acquisition, with 76% of new accounts on fee-based products.
• AI and digital service investments: The company is expanding AI-driven personalized recommendations, digital onboarding, and proactive customer service initiatives. Partnerships with OpenAI and new features like Wishlist Builder and conversational AI agents were highlighted as ways to improve member experience.
• Restructuring and efficiency focus: A $336 million restructuring charge was taken to support long-term efficiency, resulting in a 5% reduction in positions and intended to streamline decision-making and boost investment capacity for future growth priorities.

Drivers of future performance

American Express’s outlook is shaped by premium customer trends, continued technology investments, and ongoing competitive and regulatory pressures.

• AI-powered membership personalization: Management believes that embedding AI across product discovery, rewards, and service channels will deepen cardmember engagement and support differentiated value propositions. The company expects this to drive higher spend, retention, and conversion in the premium segment.
• Competitive intensity in premium and commercial: Management noted ongoing competition from peers expanding in the premium segment and digital-first competitors in commercial payments, especially in the middle market. American Express is responding with new offerings (e.g., Corporate Cashback Card) and integrations from recent acquisitions to address client needs and defend market share.
• Regulatory and rewards optimization risks: The company faces challenges from evolving regulations, such as those highlighted by the recent OCC civil penalty, and the potential for “rewards maximization” by customers using AI tools. Management is focused on balancing benefit generosity with profitability, using AI-driven analytics to monitor and adjust rewards structures.

Catalysts in upcoming quarters

Going forward, the StockStory team will be tracking (1) the pace of AI-driven product rollouts and adoption, particularly the effectiveness of new personalized features and partnerships, (2) the impact of restructuring and efficiency measures on operating leverage and investment capacity, and (3) competitive dynamics in premium and commercial card segments. Regulatory developments and evolving customer behaviors in response to digital and AI tools will also be important markers of execution.

American Express currently trades at $313.20, down from $325 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free).

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