Why American Express Stock Slipped 12% In March

Core Viewpoint - American Express shares fell 12.3% in February due to concerns over potential disruption from artificial intelligence in the financial services sector, despite strong earnings guidance for 2026 and a dividend increase [1][2]. Financial Performance - American Express reported a 16% growth in earnings per share (EPS) for Q4 2025 and is guiding for 10% revenue growth in 2026, with EPS expected to be $17.90 or more [2]. Market Concerns - The stock decline was influenced by a viral article discussing AI-agentic commerce, which suggests that AI could favor cheaper payment methods, potentially disadvantaging American Express cards [3]. - The company has faced threats from stablecoins and other payment innovations for years, with claims about the imminent decline of credit card networks [7]. Value Proposition - American Express offers a unique ecosystem through merchant partnerships, providing cardmembers with services, discounts, and perks that are not easily replicable by AI agents [4]. - The company has seen over 100% revenue growth in the last decade, adding approximately 3 million net new cards each quarter, aided by revamped perks targeting younger audiences [8]. - The share buyback program contributes to faster EPS growth compared to revenue, indicating significant operating leverage as the company scales [8].