American Express reports delinquency and write-off rates for October card loans

American Express reported October loan and credit performance showing U.S. consumer card loans of $95.2bn and small‑business loans of $31.2bn (combined $126.4bn), with 30‑day delinquencies roughly stable at 1.4% (consumer) and 1.6% (SMB) but a modest uptick in consumer net write‑offs to 2.2% (from 1.9% in September) and SMB write‑offs near 2.6%; its Credit Account Master Trust posted a 1.3% annualized default rate and $0.2bn of 30+ day delinquencies. The credit metrics show slight deterioration but remain contained, while AMEX delivered a Q3 2025 beat (EPS $4.14 vs. $3.99 est.; revenue $18.43bn vs. $18.05bn) and LTM revenue growth of ~10.2%, supporting ongoing growth despite a five‑year CAGR of ~9%. Strategic developments — expanded Emburse partnership (virtual cards, real‑time transaction data) and an executive board appointment at New York Life — bolster product and governance momentum, though InvestingPro labels the $243.9bn‑market‑cap stock as slightly overvalued at a P/E of 23.7.

Analysis

American Express reported modestly worsening but contained credit metrics for October: U.S. Consumer Card Member loans rose to $95.2 billion (from $94.1bn in September) with 30-day delinquencies stable at 1.4% and net write-offs rising to 2.2% (from 1.9% in September). U.S. Small Business loans reached $31.2 billion with 30-day delinquencies steady at 1.6% and write-offs roughly stable at 2.6%; combined loans held for investment totaled $126.4 billion, up from $124.8 billion in September. The American Express Credit Account Master Trust showed an annualized default rate net of recoveries of 1.3% for October and September and $0.2 billion of 30+ day delinquencies, indicating credit stress is measurable but not acute.

Operationally and financially, AmEx beat Q3 2025 estimates with EPS $4.14 versus $3.99 and revenue $18.43 billion versus $18.05 billion, supporting the reported 10.2% LTM revenue growth and a five-year CAGR of ~9%. The company’s current ratio of 1.6 supports near-term liquidity, but InvestingPro flags the $243.9 billion market cap stock as slightly overvalued at a P/E of 23.7. Strategic product progress with Emburse (virtual cards, real-time transaction data) and a senior executive board appointment add distribution and governance positives that could support card growth if credit trends stabilize.

Key Decisions for Investors

• Maintain a neutral-to-hold stance on AXP given the Q3 beat and revenue momentum but the slightly rich P/E of 23.7; avoid initiating large positions at current levels and prefer staged entries on meaningful pullbacks
• Monitor credit indicators closely — consumer net write-offs (2.2% in October), SMB write-offs (2.6%), 30-day delinquencies, and Master Trust default rates — and trim exposure if write-offs or delinquencies trend higher for multiple months
• Tilt toward adding exposure only if subsequent quarterly results show sustained revenue acceleration or improvement in credit metrics, as strategic wins with Emburse enhance upside conditional on stable credit performance