American Express Co. is cutting 5% of its headcount globally as Chief Executive Officer Steve Squeri seeks to keep a lid on the company’s rising costs.
Squeri told Bloomberg TV that the company has 78,000 employees, meaning the move will affect about 3,500 jobs.
Financial firms have been cutting jobs in recent months, with some companies attributing the changes to the increased use of artificial intelligence. This week, Barclays Plc said it would eliminate 5,000 jobs. HSBC Holdings Plc is planning job reductions across its UK wealth-management business, Bloomberg News reported earlier this month, and Citigroup Inc. has also been lowering its headcount.
Squeri said on a call with analysts Friday that the job cuts reflect the desire to make the company more agile and efficient, and find ways to reduce layers and speed up decision making.
The company has also been facing consistent pressure to keep and retain its premium card members. To do that, Amex has been refreshing certain cards, adding a raft of new perks last year to its Platinum card. Earlier this month, the company said it would work with Airbnb Inc. to allow for certain luxury rentals on its travel site to count for the cardholders’ annual lodging credit.
Overall, that’s boosted costs. The New York-based firm said expenses climbed about 9% to $14.5 billion in the third quarter, although it was less than the $14.8 billion estimate from analysts.
Costs for member rewards were up 10% in the quarter, while marketing expenses rose 11%. Chief Financial Officer Christophe Le Caillec had previously said to expect marketing expenses to increase by around 10% in the second half of 2026 compared with last year.
“It’s been highly competitive,” Squeri said about the fight for premium cardholders on the call. “And our assumption is that it will remain highly competitive.”
Card Spending
The workforce cuts were announced after Amex posted third-quarter earnings that beat estimates, with adjusted earnings per share of $4.68 surpassing the $4.49 average analyst estimate in a Bloomberg survey.
The company also raised its full-year earnings guidance, saying it expects earnings per share of $18.30 to $18.60 in 2026, according to a statement Friday. Previously, the figure was expected to be $17.30 to $17.90.
But billed business — a measure of transactions on credit cards and other products — came in at $454 billion in the third quarter, shy of the $456.9 billion average estimate in a Bloomberg survey. The company said it had exited some small-business co-brand deals, which affected results.
That slower growth in billed business is likely a slight disappointment, according to Truist Securities analysts including Brian Foran.
“The headline is good — Amex beats on earnings and raises full year guidance,” the analysts said in a note to clients. “The details are more mixed.”
GBT Sale
The company’s results were also affected by the sale of Amex’s equity interest in in Global Business Travel Group Inc., which resulted in a $751 million after-tax gain. Amex used a portion of the gain to fund a $253 million after-tax restructuring charge tied to efficiency initiatives. The gain, net of the restructuring, is excluded from the adjusted results.
“Our business momentum continues, with strength in billings, new acquisitions and card member retention, and excellent credit quality,” Squeri said in the statement.
The company is also facing a $350 million fine due to anti-money-laundering violations. The US Office of the Comptroller of the Currency and the Federal Reserve brought enforcement actions against Amex earlier this month, alleging deficiencies in the firm’s anti-money-laundering systems.
Amex said at the time that the penalty won’t affect the full-year 2026 guidance it previously issued or any 2027 outlook, and the orders don’t impose an asset cap on the firm.
Smith and Bostick write for Bloomberg.
The post American Express to cut 3,500 jobs as costs climb appeared first on Los Angeles Times.
