American Express Co Earnings - Q1 2026 Analysis & Highlights
American Express reported strong Q1 2026 results with accelerating spend growth, robust premium customer demand, and strategic investments in marketing and technology to capitalize on momentum, while maintaining excellent credit quality and reaffirming full-year guidance.
Key Financial Results
Revenue growth of 11% reported (10% FX-adjusted) with broad-based growth across all revenue lines.
Earnings per share (EPS) of $4.28, up 18% year-over-year, delivering very strong returns.
Card Member spending grew 10% on a reported basis, representing the highest quarterly growth in three years, driven by strong growth across both goods and services and travel and entertainment.
Net card fees grew 16% FX-adjusted, continuing as the fastest growing revenue line.
Net interest income (NII) grew 12% FX-adjusted, growing faster than balances while maintaining best-in-class credit results.
Service fees and other revenue grew at double-digit rates again this quarter.
Return on equity (ROE) of 35% this quarter, enabling strong shareholder returns.
Business Segment Results
International segment (ICS) had strong growth of 13% FX-adjusted, with spend growth up 20% including FX impact, representing the fastest growing segment with billings up double digits for the 20th consecutive quarter on an FX-adjusted basis.
US Platinum portfolio showed accelerated spend growth following the refresh while maintaining high retention rates after the fee increase went into effect.
Luxury retail merchant spending was up 18%, reflecting the continued strength of the premium customer base.
Retail spending kept up momentum, up 11% FX-adjusted.
Restaurant spending was up 9% this quarter.
Airline spending grew 8%, driven by higher growth across consumers, SMEs and large corporates, though growth softened in the last few weeks of March and into April due to travel disruptions from the Middle East conflict.
Lodging spend on fine hotels and resorts and hotel collection programs is up 50% year-over-year.
Dining spend at US Resy restaurants is up 20%.
New card acquisition of 3.1 million cards in the quarter, with continued momentum in acquiring younger customers and attracting new customers onto fee-paying products.
Capital Allocation
$2.3 billion of capital returned to shareholders, including $0.7 billion of dividends and $1.7 billion of share repurchases.
Dividend increased by 16%, demonstrating confidence in the sustainability of earnings generated by the company's model.
High levels of earnings returned to shareholders around 75% over the past three years.
Strong balance sheet and capital position maintained with plans to continue returning excess capital generated to shareholders while supporting growth.
Industry Trends and Dynamics
Strong demand and engagement with premium products across the customer base, with over 70% of new accounts acquired on fee-paying products.
Millennial and Gen Z spending growth continues to be robust globally, with over 70% of new accounts on fee-paying products.
High yield savings and direct CD balances up 9% year-over-year, with strong demand for deposit products.
Millennial and Gen Z customers make up over half of high yield savings accounts and about a third of the balances.
Gen Z accounts up 38%, millennials up 13%, Gen Xers up 8%, and boomers up about 4% in terms of new customer acquisition.
Competitive Landscape
Closed-loop network provides end-to-end view of transactions with perfect information flow between Card Members, the network, and merchants, providing significant competitive advantage in fraud detection and risk management.
Best-in-class credit performance with delinquency and write-off rates still below 2019 levels, and write-off dollars up only 4% year-over-year while NII grows at double-digit pace.
Differentiated membership model fueled by high spending Card Members, value added by world-class partners, and innovations in service.
Unique experiences and access offered in dining, sports, entertainment and more as a compelling feature of Amex membership.
Macroeconomic Environment
Macro and geopolitical environment remains uncertain, with travel disruptions from the Middle East conflict causing airline growth to soften in the last few weeks of March and into April.
Credit performance remains excellent and stable with delinquency rates flat to last quarter and write-off rates slightly down, consistent with expectations for generally stable credit metrics throughout 2026.
Reserves reflect uncertainty in the macroeconomic environment.
No impact observed on customer base from AI-related job displacement concerns, with technological change historically fueling GDP and creating new job opportunities.
Growth Opportunities and Strategies
Multi-year global partnership with the NFL announced, making American Express the league's official payments partner beginning with the 2026 season, including exclusive Card Member experiences, ticket access, on-site activations and perks at high-profile league events.
New multi-year sports and entertainment agreements with MetLife Stadium, Mercedes-Benz Stadium, and teams that play there, plus renewal of NBA sponsorship and several agreements with NBA teams.
Expansion of airport lounges planned in Las Vegas, Boston, Charlotte, Dallas-Fort Worth and New Delhi.
Fine hotels and resorts and hotel collection programs expansion with an additional 300 properties recently accepted into the program out of approximately 1,400 who applied.
Most significant one-year commercial product expansion in company history with roadmap for eight new or enhanced products, benefits and capabilities, including launch of new Graphite Business Cash Unlimited Card, corporate cash back card, and expense management software.
Amex Agentic Commerce Experiences (ACE) developer kit introduced to enable integration of American Express cards into AI-powered transactions with trust and control.
Amex Agent Purchase Protection announced, an industry-first commitment to back Card Members by protecting registered agent purchases.
Upcoming announcements with leading AI companies to make membership assets discoverable and actionable on their platforms, and building proprietary AI-powered experiences across own platforms.
AI capabilities development with 30% benefit to programmers from a coding perspective and testing perspective, enabling faster technology development across multiple business areas.
Acquisition of Hypercard to bring expertise in expense management agents and integration into Center platform.
Financial Guidance and Outlook
Full year 2026 revenue growth guidance of 9% to 10% reaffirmed.
Full year 2026 EPS guidance of $17.30 to $17.90 reaffirmed.
Card fee growth expected to pick up as the year progresses, with impact from Platinum refresh exiting the year in the high-teens.
About one-fourth of overall US consumer Platinum portfolio built for higher annual fee with no change to very high retention rates relative to pre-refresh.
NII growth expected to continue to outpace growth in balances for the year.
VCE to revenue ratio expected to be around 44% for the full year, with some quarterly variability given seasonality.
Marketing expenses expected to grow in the mid-single digits for the full year, up from flat performance in Q1.
Low-single-digit impact to spend growth in SME expected starting in Q2 until lapping portfolio exits from small business co-brand held-for-sale portfolios, with negligible impact to pre-tax income.
Neutral to modestly positive impact to capital requirements expected under recent Basel proposals as currently proposed.
No material change to capital management approach expected in the near term.
Product Innovation and Technology
Platinum refresh driving high levels of engagement with membership assets by US consumer Card Members.
Strong growth in luxury retail and front-of-cabin spending reflecting premium customer engagement.
AI-powered products and capabilities under development to help transform and grow the business.
Intent-driven authorizations and enhanced fraud protection being developed for agentic commerce transactions through closed-loop network advantages.
Data advantage in agentic commerce positioning the company well for fraud detection and risk management in autonomous transaction environments.
