The Zhitong Finance App learned that American Express (AXP.US) is laying off 5% of its employees globally, and CEO Steve Squerry is trying to control the company's rising costs.
CEO Squerry told the media that the company has 78,000 employees, which means that this layoff will affect about 3,500 jobs.
Financial institutions have been laying off workers in recent months, and some companies have attributed this change to increased use of artificial intelligence. This week, Barclays said it would cut 5,000 jobs. HSBC Holdings is planning to lay off employees in the UK wealth management business, and Citigroup has also been reducing the number of employees.
Squiry said in a conference call with analysts on Friday that the layoffs reflect the company's desire to be more agile and efficient, and to reduce management levels and speed up decision-making.
Following Express's better-than-expected third-quarter earnings report, the layoffs were announced — adjusted earnings per share of $4.68, exceeding the average analysts' expectations of $4.49 in the Bloomberg survey.
According to a statement on Friday, the company also raised its full-year earnings guidance and expects earnings per share of $18.30 to $18.60 in 2026. Previously, the figure was expected to be between $17.30 and $17.90.
However, “credit card spending,” which measures the transaction volume of credit cards and other products, was US$454 billion in the third quarter, lower than the average estimate of US$456.9 billion in the survey. The company said it withdrew from some small business co-branded card agreements, which affected its performance.
Truist Securities analyst Brian Flane and others said that the slowdown in credit card spending growth may be slightly disappointing.
In a report to clients, the analyst wrote, “Overall, it's good — Express's profit exceeded expectations and raised its full-year guidance,” “but the details are mixed.”
GBT for sale
The company's performance was also affected by the sale of its interests in Global Business Travel Group (GBT), which resulted in after-tax revenue of $751 million. Express used part of the proceeds to cover $253 million post-tax restructuring costs associated with efficiency initiatives. The proceeds after deducting the restructuring were excluded from the adjusted results.
“Our business momentum continues, with strong credit card turnover, new customer acquisition and cardholder retention, and excellent credit quality,” Squery said in a statement.
American Express said that expenses in the third quarter increased by about 9% to 14.5 billion US dollars, lower than analysts' expectations of 14.8 billion US dollars.
Express has been updating some of its credit cards, adding a range of benefits to its Platinum Card last year. Earlier this month, the company said it would partner with Airbnb to allow some luxury stays on its travel site to count towards cardholders' annual stay credits. Chief Financial Officer Christophe Lecayek previously stated that marketing expenses are expected to increase by about 10% in the second half of 2026 compared to the same period last year.
The company is also facing a $350 million fine for an anti-money laundering violation. The US Monetary Commission (OCC) and the Federal Reserve took enforcement action against Express earlier this month, alleging flaws in its anti-money laundering system.
Express said at the time that the fine would not affect its previously issued 2026 full-year guidance or any 2027 outlook, and that these orders would not impose asset caps on the company.