NEW YORK, July 24, 2026 – American Express Company (NYSE:AXP) shares closed at $326.17 on Friday, down 4.3% in a single session and 8.2% lower for the week. The decline came despite a second-quarter earnings beat, as investors focused on rising costs that absorbed nearly all of the revenue growth.
The company reported a 10% increase in net revenue after interest expense, reaching $19.637 billion, slightly below the $19.69 billion consensus estimate. However, total consolidated costs surged 12% to $14.482 billion, offsetting roughly 89% of the additional revenue generated during the quarter. This left only about $200 million in incremental revenue before accounting for credit provisions.
Despite the cost pressures, AmEx posted a 15% rise in pretax income to $4.071 billion, aided by a 23% decline in provision for credit losses to $1.084 billion. The reduction in provisions, which included a reserve release, contributed about 62% of the $521 million increase in pretax profit. Net income grew 8% to $3.11 billion, with diluted earnings per share of $4.53 coming in 13 cents above the FactSet forecast.
Spending on customer rewards, business development, and card-member services rose sharply to $8.755 billion from $7.508 billion a year earlier. Billed business climbed 9% to $455.8 billion, marking the fastest expansion in three years, while travel and entertainment spending increased 10%. The net write-off rate held steady at 2.0%.
CEO Stephen Squeri said the company plans to "reinvest this outperformance in growth initiatives," which explains why AmEx kept its full-year earnings forecast of $17.30 to $17.90 per share unchanged, even as it raised its 2026 revenue growth projection to 10% from the prior range of 9% to 10%. The decision to maintain the EPS outlook suggests management intends to channel most of the additional revenue into spending on marketing and rewards.
David Wagner of Aptus Capital Advisors noted that the spending "won't immediately flow through to bottom-line profits," a concern that appeared to resonate with market participants on Friday. The stock has now fallen for six consecutive sessions, its longest losing streak in two years.
In contrast, Visa Inc. (NYSE:V) closed up 1.1% and Mastercard Incorporated (NYSE:MA) advanced 1.8% on Friday, indicating that the margin issue is specific to American Express rather than a broad sell-off in payment stocks. Visa is scheduled to report results after Tuesday’s market close, followed by Mastercard on Thursday morning, with their volume metrics expected to provide fresh insight into travel and consumer payment trends.
Risks remain centered on credit and expense management. Card balances rose 8% to $218.1 billion. The unchanged earnings outlook could face pressure from rising delinquencies, increased reward redemption, or higher marketing costs in the second half of the year.
