American Express Q4 EPS misses estimates despite 10% revenue growth

American Express reported its fourth-quarter earnings on Friday, with earnings per share EPS coming in slightly below Street expectations even as revenue topped estimates.

The US card network and payments major posted revenue of $18.98 billion for the fourth quarter of fiscal 2025, marking a 10% year-on-year increase and marginally ahead of the Bloomberg consensus estimate of $18.92 billion.

American Express reported fourth-quarter diluted earnings per share of $3.53, missing the Bloomberg consensus

estimate of $3.56.

Fourth quarter performance

For the October–December quarter, American Express reported discount revenue of $9.88 billion, broadly in line with estimates of $9.87 billion. Net card fees rose to $2.63 billion, slightly above the Street estimate of $2.62 billion, reflecting continued strength in premium card memberships.

Provision for credit losses increased 7.7% year-on-year to $1.4 billion, compared with estimates of $1.45 billion, while total expenses rose to $14.5 billion, higher than the Street estimate of $14.22 billion.

Card rewards expenses stood at $4.81 billion, marginally lower than the estimated $4.87 billion.

On volumes, network volume reached $506.2 billion, exceeding estimates of $500.99 billion, while billed business increased 9% year-on-year to $445.1 billion, ahead of the Street estimate of $441.43 billion.

Total card member loans grew 8.7% year-on-year to $151.83 billion, compared with estimates of $151.55 billion.

The effective tax rate for the quarter declined to 20.3%, versus 21.3% in the year-ago period and below the Street estimate of 23.2%.

Management commentary

Commenting on the quarter, the company said, “In the fourth quarter, Card Member spending increased 8% on an FX-adjusted basis, net card fee revenues grew double digits for the 30th consecutive quarter, and our credit metrics remained best-in-class.”

American Express reiterated its long-term targets, aiming for revenue growth of more than 10% and earnings per share growth in the mid-teens over the cycle.

Outlook and capital returns

For the full year ahead, the company forecast earnings per share in the range of $17.30 to $17.90, compared with the Bloomberg consensus estimate of $17.55. It also expects revenue growth of 9% to 10% for the year.

In addition, American Express said it plans to raise its quarterly dividend by around 16% to $0.95 per share from $0.82 per share, with the increase set to take effect from the first-quarter FY26 declaration.

According to Bloomberg data, American Express currently has 13 buy ratings, 19 holds, and 2 sell ratings.