American Express Lifts Its Outlook as Membership Fees Carry Growth

Record third-quarter revenue, a reserve release and an exclusive Airbnb partnership let Amex raise its 2026 profit forecast, even as the cost of rewarding members kept climbing.

Key Takeaways

• Adjusted EPS rose 13% to $4.68 on record revenue of $20.06 billion, as net card fees climbed 16% to $2.97 billion and outpaced the 8% growth in spending on Amex-issued cards.
• The adjusted 2026 EPS range rises to $17.60 to $17.90 from $17.30 to $17.90, answering July’s sell-off, yet customer engagement costs again grew far faster than revenue.
• An exclusive Airbnb deal adds over one million listings to Amex Travel and extends Platinum’s renamed $600 Lodging Credit to Airbnb Luxe stays, widening where that benefit can be spent.

Paid for Membership, Not Just Spending

American Express increasingly earns its living as a membership business with a payments network attached, and its third-quarter results made that case more plainly than any quarter this year. Revenue net of interest expense reached a record $20.1 billion, up 9% from a year earlier, and the company raised its full-year earnings forecast. Reported earnings per share rose 31% to $5.42, lifted by a $982 million pre-tax gain on the sale of its stake in Global Business Travel Group, net of restructuring costs tied to efficiency initiatives. The restructuring charge came to $336 million before tax. Strip out both items, and adjusted EPS rose 13% to $4.68, clear of pre-release consensus estimates that ranged from $4.47 to $4.58.

The mix of that growth is the more revealing story. Billed business, the measure of spending on Amex-issued cards, rose 8% to $454.0 billion, a modest slowdown from 9% in the second quarter. Revenue held its pace because members are paying more simply to belong. Net card fees rose 16% to $2.97 billion, and the annualized average fee per proprietary card reached $136, up from $119 a year earlier. That gain is consistent with the higher annual fee on the refreshed U.S. Platinum Card. Discount revenue, the merchant fee that remains the largest single line, grew 8% to $10.17 billion, in step with spending, while net interest income rose 10% to $4.94 billion as card balances grew 7% and net interest yield widened to 8.5% from 8.2%. Fees are now supplying growth that volume alone no longer delivers.

The Price of Loyalty

Membership economics cut both ways, and the expense line made that clear. Variable customer engagement costs, which combine rewards, business development and card member services, rose 16% to $8.89 billion, absorbing 44.3% of revenue against 41.8% a year earlier. Card member services, where lounge access and Platinum’s statement credits are booked, jumped 36% to $2.01 billion, and marketing rose 11% to $1.77 billion. Total expenses grew 9%, matching revenue, but only because the GBTG gain was recorded as a reduction in operating expenses. Management attributed the underlying increase to higher spending and the Platinum refresh. Set the one-time gain aside, and the cost of rewarding members is rising well ahead of the revenue they generate.

The segments show where that investment is paying back and where the return is still pending. U.S. Consumer Services, home of the Platinum franchise, grew revenue 11% and lifted pretax income 24% to $2.30 billion, helped by a 33% decline in credit provisions. Commercial Services moved the other way: billed business grew just 3%, marketing rose 29% and pretax income fell 6% to $1.03 billion. International Card Services grew billings 11%, yet pretax income slipped 2% as engagement costs rose 17%. New proprietary card acquisitions of 3.1 million were a touch below the 3.2 million of a year earlier. For now, growth is coming more from deepening existing relationships than from widening the base, and the business-card side is absorbing investment ahead of its returns.

Credit and Capital in Reserve

Credit remains the least contentious part of the story. Provisions for credit losses fell to $985 million from $1.3 billion, reflecting a reserve release against a build in the prior-year quarter, and the net write-off rate eased to 1.8% from 1.9%. The share of consumer and small business balances 30 days or more past due improved to 1.2% from 1.3%, and reserves now cover 2.5% of card balances, down from 2.9% a year ago. That leaves a thinner buffer if household finances weaken. It also describes a portfolio whose loss experience has improved through the year rather than one drifting toward stress.

Capital gives management latitude. The Common Equity Tier 1 ratio rose to 10.9% from 10.4% at the end of June, return on average equity reached 42.4% on reported earnings, and about 5 million shares were retired during the quarter alongside a quarterly dividend of $0.95, 16% above a year earlier. The company also refinanced $1.6 billion of preferred stock, replacing a 3.55% Series D issue with a 6.45% Series E. That swap is a reminder of how far funding costs have reset. Discrete tax benefits pulled the effective tax rate down to 18.1% from 24.1%. Together with the GBTG gain, those items flatter the reported numbers, which is why investors will carry the adjusted figures forward rather than the headline.

Airbnb Widens the Platinum Map

A day before the results, Amex and Airbnb announced an exclusive partnership placing more than one million Airbnb listings inside Amex Travel, through a new Homes tab on AmexTravel.com and the Amex Travel app. Platinum members earn five points per dollar on prepaid bookings, while other eligible cardholders earn two. Platinum’s $600 Hotel Credit has been renamed the $600 Lodging Credit and now covers prepaid Airbnb Luxe stays of two nights or more, and a qualifying Luxe booking unlocks a new annual $250 credit for Airbnb Experiences. The integration has limits. Points cannot yet be redeemed for Airbnb stays, guests still manage their reservations on Airbnb’s own platform, and Airbnb has declined to detail the business model or financial impact.

The logic for Amex is straightforward. A statement credit is only as valuable as the inventory against which it can be spent, and Airbnb extends that inventory into villas, family homes and longer stays that hotels serve unevenly. Howard Grosfield, who leads U.S. Consumer Services, framed the deal around choice, saying where card members stay “is personal.” Skift called it Airbnb’s most integrated loyalty partnership to date and its largest step toward acting as a lodging supplier. The quarter’s other launches follow the same thread of deeper engagement: a next-generation Amex Corporate platform with integrated expense software, a Business Savings account, an extended Marriott co-brand agreement, a new Centurion Lounge at Amsterdam Schiphol, and Resy integrations with OpenAI alongside a framework for agentic commerce.

What Investors Are Weighing

The shares came into the report with ground to recover, down about 12% for the year against a gain of roughly 13% for the S&P 500. July remains the clearest statement of what troubled investors: the stock fell about 6% after management raised its revenue outlook but held its EPS range, with Stephen Squeri explaining that the company preferred to reinvest the upside rather than drop it to the bottom line. Friday’s guidance answers that complaint directly. The adjusted range moves to $17.60 to $17.90, while GAAP guidance of $18.30 to $18.60 incorporates the GBTG gain, and the company expects another year of 10% revenue growth. The midpoint rises by 15 cents, and the revenue target matches the pace delivered over the first nine months.

Two details will temper the reception. Revenue came in slightly below the roughly $20.12 billion consensus, a second consecutive quarter of marginal top-line shortfall. The new range also implies fourth-quarter adjusted EPS of $4.11 to $4.41 against expectations near $4.30, which leaves limited room for further upside. Regulatory exposure has sharpened as well. On October 8 the Office of the Comptroller of the Currency imposed a $350 million civil money penalty and a cease-and-desist order on American Express National Bank over anti-money-laundering deficiencies, alongside a Federal Reserve order against the parent. The company has said the penalty was partly reserved in earlier periods and does not affect 2026 guidance. The investment case therefore rests where it has for some time: on whether an affluent membership base keeps generating fees and spending faster than Amex must spend to retain it. This quarter shows the model still converts that spending into double-digit earnings growth, with less room for error than the headline suggests.