American Express falls 3.7% after earnings beat and 5% job cuts

What happened

American Express (AXP) fell 3.7% on October 23, 2026, because its third-quarter results topped estimates and the company said it would cut about 5% of its workforce. The company reported earnings per share of $4.68 against $4.50 expected, 4.0% above estimates, and held an earnings call the same day. Reuters and CNBC Television reported the workforce reduction, with one report noting the cuts as 3,500 jobs.

How big was the move

The stock closed at $313.22 after opening 3.1% below the previous close and traded at 1.3 times its 20-day average. The session’s drop was 2.9 times a typical daily move for this stock, and it was 3.5 percentage points worse than the Financial Services sector median, which fell 0.2% that day. The S&P 500 fell 0.5% on the day; the stock’s market sensitivity is a beta of 1.22, meaning the stock tends to move more than the market.

The technical picture

The stock was 1.0% above its 20-day moving average but 1.9% below its 50-day average and 4.3% below its 200-day average. The 50-day average is below the 200-day average, a sign of a weak longer-term trend, and the relative strength index for 14 days was 49, in a neutral range. The shares were 19.2% below the 52-week high, had risen 2.5% over one month, fallen 6.6% over three months, and fallen 11.0% over one year, which is 24.8 percentage points behind the S&P 500. Volatility was 20% annualized over 60 days, lower than 95% of its own readings over five years.

Fundamentals and valuation

For the four quarters through September 30, 2026, American Express reported revenue of $85.50 billion, which grew 8.7% from a year earlier, and diluted earnings per share of $17.81, which rose 19.5%. Gross margin was 85.2%, versus 83.0% a year earlier, and operating margin was 27.6%, compared with 17.1% a year earlier. Free-cash-flow margin was 17.2% and return on invested capital was 13.0%. The balance sheet showed net debt of 0.6 times EBITDA, and share count over one year decreased by 2.7%.

The stock traded at 17.6 times trailing earnings and 17.7 times expected forward earnings, with a free-cash-flow yield of 6.9%. Its price-to-trailing-earnings reading is lower than 71% of its own readings over the past five years, where the five-year median was 18.9 times earnings. PromtFinance scores rank Quality at 90 (Exceptional) and Value at 71 (Positive), while Growth is 32 (Weak), Momentum 19 (Very weak), and Stability 35 (Weak). Those scores portray a company with strong profitability and cash generation, but weak momentum and mixed growth prospects.

Earnings and analyst expectations

American Express reported Q3 2026 earnings per share of $4.68 on October 23, 2026, beating the Zacks Consensus Estimate of $4.47 and rising from $4.14 a year earlier. This was the third consecutive quarter beating estimates, with an average surprise over the last four reports of 3.4% above estimates. Typical two-day reactions after recent reports have been a fall of 1.4%. The company’s next report is scheduled for January 29, 2027.

Analysts covering the stock number 57, with a consensus rating of Hold, and 40% of ratings classified as Buy or Strong Buy. The consensus price target is $363.27, which is 16.0% above the closing price on October 23, 2026. Market participants will likely watch revisions in estimates following the earnings beat and the announced workforce reduction.

What to watch

• January 29, 2027: next scheduled earnings report
• Progress on workforce reduction reported October 23, 2026, and any updates on estimated job counts
• Any management commentary from the October 23, 2026, earnings call and published transcripts
• Revision trends in analyst estimates after the Q3 2026 report and the announced cuts
• Movement versus the Financial Services sector and the S&P 500 in the days following the report