American Express has projected robust earnings for the coming years, anticipating earnings per share (EPS) to fall between US$17.30 and US$17.90 by 2026. This forecast, announced on Friday, notably exceeds Wall Street expectations, reflecting the resilience of its affluent customer base in the face of broader economic challenges.
Earnings Forecast Exceeds Expectations
The credit card giant’s anticipated mid-point EPS of US$17.41 is above analysts’ average estimates, according to data from LSEG. The company’s revenue growth is also expected to range from 9 per cent to 10 per cent, aligning closely with market predictions. This optimistic outlook highlights the strength of American Express’s brand, particularly its focus on premium offerings, which analysts believe shields it from a general decline in consumer spending.
CEO Stephen Squeri stated, “As demonstrated in our results, our investments are paying off – driving increased customer demand, engagement and loyalty.” This sentiment reinforces the company’s strategic emphasis on enhancing customer experiences and loyalty programmes.
Growth in Consumer Spending
In the fourth quarter, American Express reported a significant 9 per cent increase in billed business, amounting to US$445.1 billion. This growth is particularly noteworthy given the context of U.S. retail consumer spending, which rose by 9 per cent during the Thanksgiving holiday week, outpacing a more modest 7.7 per cent increase reported by Adobe Analytics for total retail spending.
The company’s performance has resulted in a remarkable share price increase of 24.7 per cent throughout 2025, significantly outperforming competitors such as Visa and Mastercard, which saw gains of 11 per cent and 8.4 per cent, respectively. For the three months ending on December 31, American Express recorded a profit of US$3.53 per share, an increase from US$3.04 the previous year, while revenues surged by 10 per cent to US$18.98 billion.
Regulatory Concerns and Market Reactions
As American Express continues to build on its success, investor attention is turning towards potential regulatory changes that could impact credit card interest rates. U.S. President Donald Trump has proposed a one-year cap on these rates to alleviate affordability issues. However, this proposal has faced strong opposition from banking and card industry groups, who argue that such measures would restrict credit availability for many Americans.
While analysts suggest that the likelihood of the legislation passing is slim, the prospect has nevertheless affected the financial sector, contributing to a decline in stock prices earlier this month. The uncertainty surrounding potential regulatory changes underscores the fragility of the financial markets, even for industry leaders like American Express.
Why it Matters
American Express’s positive earnings outlook serves as a beacon of resilience in a time of economic unpredictability. Its focus on premium clients not only insulates the company from widespread spending slowdowns but also highlights a shift in consumer behaviour towards brands that offer unique value propositions. As American Express navigates potential regulatory hurdles, its ability to maintain customer loyalty and drive growth will be crucial in sustaining its competitive edge in an evolving financial landscape.
