American Express to Cut 5% of Global Workforce as 2026 Profit Outlook Rises

American Express (NYSE: AXP) plans to reduce its global workforce by approximately 5% as the credit-card company raises its 2026 earnings outlook following stronger third-quarter profits and continued spending growth among its customers.

The restructuring, discussed by Chief Executive Stephen Squeri on Friday, October 23, could affect roughly 3,500 to 3,800 positions, based on reported estimates. The move is aimed at simplifying management structures, accelerating decision-making and improving operating efficiency rather than responding to a reported collapse in customer spending.

The timing is notable. American Express delivered record third-quarter revenue of $20.06 billion, up 9% from $18.43 billion a year earlier, while net income climbed 28% to $3.71 billion from $2.90 billion. Diluted earnings per share increased to $5.42 from $4.14.

On an adjusted basis, earnings reached $4.68 per share, exceeding the approximately $4.48 expected by analysts surveyed by FactSet. The company raised its full-year reported earnings forecast to 18.60 per share, compared with its previous guidance of 17.90.

Its updated adjusted earnings outlook stands at 17.90 per share, excluding certain items associated with the sale of its Global Business Travel Group investment and restructuring expenses.

The distinction matters. Part of the increase in reported earnings guidance reflects the investment sale, while the adjusted forecast provides a clearer view of the company’s underlying expectations after excluding those effects. American Express also reaffirmed its expectation of approximately 10% revenue growth for 2026.

Customer spending remains a central source of strength. Billed business reached $454 billion in the third quarter, increasing 8% on a foreign-exchange-adjusted basis. Travel and entertainment spending rose 10%, including a 13% increase in airline purchases and 9% growth in restaurant spending.

Higher transaction volumes, growing card balances and increased card fees helped support revenue. Credit-loss provisions also declined to approximately $1.0 billion from $1.3 billion a year earlier, providing additional support to quarterly earnings.

The combination of stronger earnings and workforce reductions raises an important distinction for investors: American Express is restructuring while its business continues to expand, rather than announcing layoffs alongside deteriorating quarterly profits.

Management is seeking a more streamlined organization while continuing to invest in products, technology and benefits for cardholders. The company has been expanding its premium-card offerings as competition for higher-spending customers intensifies.

Still, workforce reductions do not automatically establish how much the company will save. The ultimate financial benefit depends on implementation costs, the timing of departures and whether savings are retained or reinvested.

The third-quarter restructuring also needs to be assessed separately from ongoing operating expenses. Strong earnings alone do not establish that the changes will immediately improve margins, particularly as the company continues spending on marketing, rewards and customer acquisition.

American Express shares declined during Friday’s trading despite the improved earnings outlook. The reaction followed results in which adjusted earnings exceeded expectations but revenue came in slightly below analysts’ forecasts.

The central question for subsequent earnings reports is whether the restructuring produces measurable operating efficiencies without weakening customer service or the company’s ability to attract and retain cardholders.

For now, American Express has confirmed a stronger profit outlook alongside a broad workforce-reduction initiative. The precise timing and distribution of the job cuts, as well as the recurring savings they ultimately generate, remain important details for investors to monitor.