By Manya Saini
Jan 30 (Reuters) – American Express forecast annual profit largely above Wall Street expectations on Friday, underscoring resilient spending by its young and affluent customers, but a small miss on holiday-quarter profit weighed on its shares.
The results highlighted diverging spending patterns with many U.S. consumers cutting back under the weight of elevated borrowing costs and still-high inflation while higher-income households continued to splurge on travel, dining and luxury.
“We’re not projecting any discontinuity,” AmEx CFO Christophe Le Caillec told Reuters. “Spend that Gen Z and millennials have on their American Express cards is now bigger than Gen X,” he said.
Le Caillec said this was a first for its U.S. consumer business and reflected the company’s long-standing efforts to build a younger and premium customer base.
The company forecast 2026 earnings per share between $17.30 and $17.90. The midpoint of the range is above analysts’ average projection of $17.41 per share, according to estimates compiled by LSEG.
AmEx’s profit came in at $3.53 per share in the three months ended December 31, a touch below estimates of $3.54. Citigroup analysts attributed the narrow miss to higher expenses, which rose 10% to $14.5 billion in the last three months of 2025.
The company’s shares were last down about 2% in morning trading in a weak broader market.
“If there is a rub, perhaps it is that fourth-quarter clearly shows the cost of the Platinum refresh, but doesn’t show a corresponding bump on new accounts,” analysts at Truist wrote in a note.
Last year, AmEx unveiled long-awaited upgrades to its U.S. Platinum cards with new perks.
The credit card giant’s shares had gained 24.7% in 2025, outperforming rivals Visa’s 11% and Mastercard’s 8.4%.
SPENDING HOLDS UP
Billed business, a measure of spending on AmEx cards, rose 9% to $445.1 billion in the fourth quarter.
Le Caillec pointed to a strong holiday shopping season, driven by growth across restaurant, travel, retail and luxury categories.
Revenue rose 10% to $18.98 billion, beating expectations of $18.92 billion. It forecast 2026 revenue to grow in the range of 9% to 10% versus expectations of about 9%.
Investor attention is on how AmEx will navigate a potential one-year cap on credit card interest rates at 10% proposed by U.S. President Donald Trump to address affordability concerns.
“We agree on the focus on affordability, like everybody else, we just don’t think that the proposed cap would accomplish that goal,” Le Caillec said.
(Reporting by Manya Saini in Bengaluru; Editing by Sriraj Kalluvila)
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