American Express Co

Equity Research 24 July 2026 | 8:04AM EDT

American Express Co. (AXP): First take: EPS beat on lower provisions; see 10% top-line growth with upside re-invested

Bottom line on the fundamentals / stock: Overall this was a mixed quarter, in our Ryan M. Nash, CFA | view with the beat largely driven by higher provisions as despite it taking full year Goldman Sachs & Co. LLC

revenue growth expectations up (+10% from +9-10%), revenue results were softer Lucas Haimes | than expected as NII missed expectations and card fee growth slowed. Expenses Goldman Sachs & Co. LLC were a slight miss as VCEs came in higher than expected while OPEX approximated expectations. Credit was much stronger than expected as it released $191mn of reserves.

In terms of its guidance, AXP is taking revenue guidance to +10% (from 9-10%) maintaining EPS $17.30-$17.90 of EPS. EPS at the halfway point is $8.81 and if we assume its tracking towards the high-end ($17.75-$17.80) it implies EPS of ~$9, which is in-line with the street. Lastly, the main point of debate will likely be the decision to reinvest the top-line upside as AXP noted that based on better-than-expected performance in H1….. they are raising full-year revenue growth guidance (10%) and plan to reinvest this outperformance in growth initiatives given the significant opportunities Historically speaking a revenue miss was bad for stock performance as was a top-line guide up with no EPS follow-through. So based on history we expect the stock to be down a few points today.

Four key questions for the call: 1) Can you talk about the decision to reinvest the upside to revenue growth – what areas are you investing in and will this allow you to sustain this type of growth in 2-27? 2) VCEs came in higher than expected, is this just driven by spend mix and what are your updated thoughts on VCEs for full year 2026? 3) Despite the exit of Lowe’s commercial you were able to see Commercial spend improve 100bps – what drove the change and can you sustain these growth rates? When will we be getting more details on the refresh? And 4) You expect to generate a $975mn pre-tax gain next quarter due to the sale of GBT. What are you expecting to do with the proceeds in terms of re-investing vs. hitting the bottom line?

2026 Outlook: AXP updated its 2026 expectations for revenue growth to +10% YoY (vs. +9-10% prior) while leaving its EPS range of $17.30-$17.90 unchanged as they noted revenue outperformance is being reinvested in growth initiatives. For 2H, this implies revenues of $40.91bn which is relatively in-line with consensus expectations while for EPS (assuming the high-end) it implies ~$9 which is relatively in line with implied 2H ($8.99 consensus). Additionally, AXP laid out expectations for YoY card fee growth to accelerate on a YoY basis in 3Q and exit at the high-teens in 4Q.

High level thoughts on earnings: AXP reported 2Q26 EPS of $4.53 vs. VA

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Goldman Sachs American Express Co. (AXP)

Consensus of $4.45. Relative to expectations, revenues came in a little lower as slower NII (+11% YoY vs. consensus of +12%), card fees (+15% vs. consensus +17%) and other (~4% below expectations) more than offset a beat on discount revenues (+9.5% YoY to $455.8bn vs. street at $455.7bn) drive by slightly higher billed business. Billings came in a touch ahead of expectations, with US consumer increasing to +11% YoY (+10% YoY in 1Q), along with a tick up in Commercial (+5% YoY vs. +4% YoY in 1Q; despite some of the late quarter Lowes headwinds), and international spend on a FX adjusted basis ticked lower to +12% YoY (+13% YoY in 1Q), with reported international declining to +13% YoY (vs. +20% YoY in 1Q). NCAs…