American Express Company 2026 Q3 Earnings Call

Thank you, Dana, and thank you all for joining today's call. Today's discussion contains forward-looking statements about the company's future business and financial performance. These are based on management's current expectations and are subject to risks and uncertainties. Factors that could cause actual results to differ materially from these statements are included in today's presentation slides and in our reports on file with the SEC. Today's discussion also contains non-GAAP financial measures. Comparable GAAP financial measures are included in this quarter's earnings materials, as well as the prior period earnings materials discussed today. All of these are posted on our website at ir.americanexpress.com. We will begin today with Steve Squeri, Chairman and CEO, followed by Christophe Le Caillec, Chief Financial Officer. After their remarks, we will move to Q&A. With that, I will turn it over to Steve.

Thank you, Kartik. Good morning, and thanks for joining us. We had another strong quarter with record revenues of $20 billion, up 9%, and EPS of $5.42 reported and $4.68 on an adjusted basis. Given our strong performance year to date, we are reaffirming our revenue growth guidance of 10% and raising our EPS guidance to between $18.30 and $18.60 on a reported basis, or between $17.60 and $17.90 on an adjusted basis. There are a number of discrete items in this quarter's results. Christophe will go through them in detail. I will highlight a few of them. First, with the closing of the Global Business Travel transaction in the quarter, we are dropping two-thirds of the gain to the bottom line. Excluding the impact of the gain, as well as the portion of it we are using for restructuring, adjusted EPS was $4.68.

Second, adjusted EPS includes an expense for legal matters, which includes the unreserved portion of the recently announced civil money penalty levied by the OCC. The fine does not impact our full year 2026 guidance. The orders do not impose an asset cap on the company, and the costs associated with the remediation are not anticipated to affect 2027 guidance. More importantly, the deficiencies cited in the consent order should not have occurred, and we are accountable for addressing them thoroughly. This is critical to our future and to maintaining the trust that our customers, regulators, colleagues, and investors place in us. We have earned that trust over many years, and we can never take it for granted. Also this quarter, as I mentioned, we are using a portion of the gain from the Global Business Travel transaction to continue positioning the company for long-term growth.

Our strong business performance throughout the year has enabled us to step up our marketing and technology investments. We decided to use some of the gain to invest in making the organization more efficient and better prepared for the future. As a result, we took a $336 million charge for restructuring in the quarter, which is expected to result in the elimination of approximately 5% of our positions globally. Because this quarter's charge is somewhat larger than what we typically do, I will take a moment to provide a bit more context. We have got good momentum, but to accelerate innovation and win over the next few years, we needed to become a more agile and efficient organization.

With that objective in mind, earlier this year, I asked the senior leadership team to identify ways to streamline their organizations, align their teams on the most critical deliverables, and reduce layers to speed decision-making. When completed, we believe this exercise will help us operate and execute more effectively and give us greater capacity to invest in our business priorities. I would also like to highlight the latest example of how we are continuing to invest in our membership model to enhance its value to our card members. Yesterday's announcement of our exclusive partnership with Airbnb, which follows the recent announcements of new and expanded Centurion Lounges and our next-generation Corporate Cashback Card and expense management program.

We know that card members enjoy the exceptional variety and scope of Airbnb's network of unique locations, and we are excited to bring over 1 million listings globally into our Amex Travel program, as well as expanding travel benefits for eligible U.S. card members. Next, I would like to talk about how we are thinking about AI and the rise of AI assistance. There has been a lot of talk about how companies are using AI to increase productivity, automate processes, and generally make their organizations more efficient. We are using AI to do all of those things, too. But I want to talk about AI and agentic commerce from the customer's perspective, how their experience will evolve, and what it means for American Express. It is still early in the game. Agentic transaction volumes are still small, but the direction is clear.

AI is fundamentally changing how consumers and businesses discover, compare, decide, pay, and manage their finances and their lives. But while AI agents are able to act on customers' behalf, that does not change who the customer is. Our customer remains the card member, and the job remains the same: deliver differentiated value and have their back. The way I think about AI is simple. AI gives us the opportunity to make Amex membership even more valuable. We are well-positioned to do just that. Our differentiated assets, closed-loop network, first-party data, and brand built on trust, security, and service are even greater advantages in an AI world. Our goal is to have membership travel with our card members throughout these new AI-powered experiences, shaping recommendations, securing payments, activating the right value, and supporting the customer afterward.

In other words, we want to become even more essential to our customers, continuing to embed Amex membership where decisions happen. That's the key idea between the five key areas we're using AI to enhance the customer experience. First, value propositions. Amex membership is all-encompassing. It's a combination of the unique access, benefits, experiences, rewards, convenience, world-class partnerships, and great service we offer our cardmembers. AI gives us the opportunity to take our value propositions much further. Combining the proprietary insights from our closed loop, our partner relationships, and access to membership experiences to create entirely new forms of value that are more personalized and differentiated than ever before. Take dining. Through Resy and our restaurant partnerships, we are already giving eligible cardmembers access to sought-after restaurants and exclusive experiences. We're now using AI to combine that ecosystem with our understanding of individual cardmembers' tastes and preferences.

Our dining companion, for example, uses insights from cardmember spending to make personalized restaurant recommendations. Looking ahead, we can imagine using AI to better understand the kinds of experiences different cardmembers would enjoy, and then working with our restaurant partners to create distinctive experiences tailored to those interests at a level of personalization and scale we couldn't achieve before. That's the opportunity. Taking something American Express already does exceptionally well and leveraging cutting-edge technology to make it even more personal, relevant, and differentiated. Second, customer acquisition. As AI changes how customers search and choose financial products, our ambition is to help shape the discovery and decision-making process, ensuring that the full value of American Express membership is clear and compelling wherever prospective customers are exploring options.

We're evolving how we reach prospective customers in this new environment, rethinking traditional search and digital channels, optimizing how our products and benefits are discovered and represented by AI platforms, and developing new ways to reach customers through LLMs and agents. At the same time, we're transforming our marketing and acquisition engine. By combining AI and our proprietary data, we can better identify the right prospects, match them with relevant products and offers, and create more personalized shopping, product application, and onboarding experiences. Our goal is to make becoming an American Express member increasingly seamless and tailored to the individual, helping us attract more high-quality customers, improve conversion, and make every marketing dollar work harder. Third, engagement. AI gives us the opportunity to fundamentally change how cardmembers experience membership, making it more proactive, personalized, and relevant throughout their lives.

While we'll do this within our own channels and through partnering with leading AI companies to make our membership assets available through their platforms customers use to discover, plan, and make decisions. Let me give you a few examples. We're deepening our partnership with OpenAI to continue bringing Amex card membership into ChatGPT. Earlier this year, we launched Resy Restaurant Discovery and Reservations in ChatGPT and are working with OpenAI to launch an Amex plugin that will enable cardmembers to discover and enroll in Amex Offers. We continue to collaborate closely on the future of payments and have built proprietary dining and hotel conversational experiences that use OpenAI models. In our own channels, Wishlist Builder in our travel app uses AI to help customers discover hotels and plan trips.

Through our partnership with Perplexity, eligible business card members can now access Amex-curated AI tools for tasks like cash flow forecasting and creating marketing campaigns. Our vision is for Amex membership to become an an intelligent, personalized experience, proactively bringing the right experiences and benefits to card members at the right moment wherever their journey begins. Fourth, payments. As AI agents begin to transact on behalf of customers, trust and security become even more important. Our ambition is to make American Express the trusted way to pay across AI ecosystems, ensuring that card members remain in control and that the protections and differentiated value they expect from us extend into this new way to pay. Right now, we are helping to shape the standards for trusted agentic payments. The principle is straightforward. We need to know who the agent is, what the customer has authorized it to do, and have a secure way to complete the payment.

The transaction of the future will carry more than a payment credential. It will carry context. We outline the capabilities we are building in our Agentic Commerce Experiences, or ACE, developer kit we published in the second quarter, and we are working with several leading AI companies on integrating ACE into their platforms to enable agent-powered transactions. Earlier this month, we also released our Intent Intelligence framework that sets forth a standard to help ensure customer purchase intent is authenticated and preserved. We are developing Agent Purchase Protection to extend the backing of American Express to eligible purchases when registered agents share intent data and then make mistakes.