American Express Company (NYSE:AXP, XETRA:AEC1) reported stronger-than-expected first-quarter 2026 earnings on Wednesday, surpassing Wall Street forecasts for both revenue and profit, supported by continued growth in premium cardmember spending and higher fee income.
However, shares fell more than 2% in early trading as investors reacted to cautious forward guidance and rising expense plans.
The financial services company posted earnings per share (EPS) of $4.28, ahead of analyst estimates of $4, and up 18% from $3.64 a year earlier.
Revenue, net of interest expense, rose to $18.91 billion, exceeding expectations of $18.61 billion and representing an 11% year-over-year increase.
Net income for the quarter reached $2.97 billion, compared with $2.58 billion in the same period last year.
American Express said total billed business increased 10% on a reported basis, or 9% adjusted for foreign exchange, driven by higher consumer and business spending across its premium customer base. Card member spending growth accelerated to 10%, the strongest quarterly rate in three years.
“We had a very strong start to the year,” said chairman and CEO Stephen Squeri, citing continued momentum in premium card engagement and disciplined execution of the company’s growth strategy.
He noted that credit performance remained strong and that spending trends were supported by demand for travel and entertainment.
Despite the upbeat results, investor sentiment weakened after the company reaffirmed its full-year 2026 guidance rather than raising it. American Express continues to expect revenue growth of 9% to 10% and full-year EPS between $17.30 and $17.90.
Also weighing on the stock was the company’s decision to increase investments in marketing and technology, which management said was aimed at supporting long-term growth initiatives.
During the quarter, expenses rose 11% year-over-year to $13.9 billion, driven by increased customer engagement costs, benefit usage on premium cards, and higher operating expenses.
Credit loss provisions increased slightly to $1.3 billion from $1.2 billion a year earlier, reflecting higher net write-offs and a smaller reserve release compared to the prior year.
Card acquisitions also showed signs of moderation, with 3.1 million new cards added during the quarter, down from 3.4 million in the same period last year.
Management highlighted temporary disruptions in travel-related spending, noting that airspace closures in parts of the Middle East led to a late increase in refund requests, though airline spending still grew 8%.
