Item 1. FINANCIAL STATEMENTS

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Item 1. FINANCIAL STATEMENTS

AMERICAN EXPRESS COMPANY

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

Three Months Ended March 31 (Millions, except per share amounts)20262025
Revenues
Non-interest revenues
Discount revenue$9,512$8,743
Net card fees2,7522,333
Service fees and other revenue1,9511,722
Total non-interest revenues14,21512,798
Interest income
Interest on Card balances and Other loans6,1365,552
Interest and dividends on investment securities1714
Deposits with banks and other512569
Total interest income6,6656,135
Interest expense
Deposits1,2871,337
Long-term debt and other686629
Total interest expense1,9731,966
Net interest income4,6924,169
Total revenues net of interest expense18,90716,967
Provisions for credit losses
Card balances1,1871,047
Other64103
Total provisions for credit losses1,2511,150
Total revenues net of interest expense after provisions for credit losses17,65615,817
Expenses
Card Member rewards4,8914,378
Business development1,5911,529
Card Member services1,9751,328
Marketing1,4801,486
Salaries and employee benefits2,4822,120
Other, net1,4591,646
Total expenses13,87812,487
Pretax income3,7783,330
Income tax provision807746
Net income$2,971$2,584
Earnings per Common Share (Note 13)(a)
Basic$4.29$3.64
Diluted$4.28$3.64
Average common shares outstanding for earnings per common share:
Basic685701
Diluted686702

(a)Reflects net income less (i) earnings allocated to participating share awards of $19 million and $18 million for the three months ended March 31, 2026 and 2025, respectively, and (ii) dividends on preferred shares of $14 million for both the three months ended March 31, 2026 and 2025.

See Notes to Consolidated Financial Statements.

Table of Contents

AMERICAN EXPRESS COMPANY

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

Three Months Ended March 31,
(Millions)20262025
Net income$2,971$2,584
Other comprehensive income (loss):
Net unrealized debt securities gains (losses), net of tax(7)3
Foreign currency translation adjustments, net of hedges and tax(22)17
Net unrealized pension and other postretirement benefits, net of tax(5)9
Other comprehensive income (loss)(34)29
Comprehensive income$2,937$2,613

See Notes to Consolidated Financial Statements.

Table of Contents

AMERICAN EXPRESS COMPANY

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(Millions, except share data)March 31, 2026December 31, 2025
Assets
Cash and cash equivalents
Cash and due from banks (includes restricted cash of consolidated variable interest entities: 2026, $6; 2025, nil)$3,186$3,559
Interest-bearing deposits in other banks (includes restricted interest-bearing deposits of consolidated variable interest entities: 2026, $19; 2025, nil)50,28143,491
Short-term investment securities (includes restricted investments of consolidated variable interest entities: 2026, $85; 2025, $84)290742
Total cash and cash equivalents (includes restricted cash: 2026, $199; 2025, $169)53,75747,792
Card balances (includes gross amounts available to settle obligations of consolidated variable interest entities: 2026, $33,386; 2025, $33,378), less reserves for credit losses: 2026, $6,065; 2025, $6,089207,247207,774
Card balances held for sale2,4772,457
Other loans, less reserves for credit losses: 2026, $314; 2025, $32310,53510,605
Investment securities2,6251,043
Premises and equipment, less accumulated depreciation and amortization: 2026, $12,441; 2025, $12,0397,2406,118
Other assets, less reserves for credit losses: 2026, $121; 2025, $8625,01324,263
Total assets$308,894$300,052
Liabilities and Shareholders’ Equity
Liabilities
Customer deposits$157,948$152,488
Accounts payable14,63514,700
Short-term borrowings1,6921,371
Long-term debt (includes debt issued by consolidated variable interest entities: 2026, $13,278; 2025, $13,022)58,75056,387
Other liabilities41,87441,632
Total liabilities$274,899$266,578
Contingencies (Note 7)
Shareholders’ Equity
Preferred shares, $1.662/3 par value, authorized 20 million shares; issued and outstanding 1,600 shares as of March 31, 2026 and December 31, 2025——
Common shares, $0.20 par value, authorized 3.6 billion shares; issued and outstanding 682 million shares as of March 31, 2026 and 686 million shares as of December 31, 2025137138
Additional paid-in capital11,08111,126
Retained earnings26,08825,487
Accumulated other comprehensive income (loss)(3,311)(3,277)
Total shareholders’ equity33,99533,474
Total liabilities and shareholders’ equity$308,894$300,052

See Notes to Consolidated Financial Statements.

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AMERICAN EXPRESS COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Three Months Ended March 31 (Millions)20262025
Cash Flows from Operating Activities
Net income$2,971$2,584
Adjustments to reconcile net income to net cash provided by operating activities:
Provisions for credit losses1,2511,150
Depreciation and amortization468433
Stock-based compensation203158
Deferred taxes145(20)
Other items (a)(282)213
Originations of Card balances held for sale(42)—
Changes in operating assets and liabilities, net of effects of acquisitions and dispositions:
Other assets(1,386)18
Accounts payable & other liabilities476228
Net cash provided by operating activities3,8044,764
Cash Flows from Investing Activities
Sale of investments8—
Maturities and redemptions of investments233285
Purchase of investments(1,978)(239)
Net decrease in Card balances and Other loans, including Card balances held for sale512835
Purchase of premises and equipment, net of sales (b)(1,149)(430)
Acquisitions, net of cash acquired(498)—
Net cash (used in) provided by investing activities(2,872)451
Cash Flows from Financing Activities
Net increase in customer deposits5,3756,973
Net increase in short-term borrowings110131
Proceeds from long-term debt (b)3,5024,768
Payments of long-term debt(1,524)(3,534)
Issuance of American Express common shares722
Repurchase of American Express common shares and other(1,911)(1,208)
Dividends paid(583)(509)
Net cash provided by financing activities4,9766,643
Effect of foreign currency exchange rates on cash and cash equivalents5710
Net increase in cash and cash equivalents5,96511,868
Cash and cash equivalents at beginning of period47,79240,640
Cash and cash equivalents at end of period$53,757$52,508

(a)Primarily includes gains/losses on fair value hedges, foreign currency transactions, tax credit and Amex Ventures investments and movements in equity method investments.

(b)Excludes an increase of $370 million related to non-cash activity for a finance lease. Refer to Note 1 for additional information.

See Notes to Consolidated Financial Statements.

Table of Contents

AMERICAN EXPRESS COMPANY

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited)

Three months ended March 31, 2026 (Millions, except per share amounts)TotalPreferred SharesCommon SharesAdditional Paid-in CapitalAccumulated Other Comprehensive Income (Loss)Retained Earnings
Balances as of December 31, 2025$33,474$—$138$11,126$(3,277)$25,487
Net income2,971————2,971
Other comprehensive income (loss)(34)———(34)—
Repurchase of common shares(1,664)—(1)(86)—(1,577)
Other changes(86)——41—(127)
Cash dividends declared preferred Series D, $8,875.00 per share(14)————(14)
Cash dividends declared common, $0.95 per share(652)————(652)
Balances as of March 31, 2026$33,995$—$137$11,081$(3,311)$26,088
Three months ended March 31, 2025 (Millions, except per share amounts)TotalPreferred SharesCommon SharesAdditional Paid-in CapitalAccumulated Other Comprehensive Income (Loss)Retained Earnings
Balances as of December 31, 2024$30,264$—$141$11,370$(3,395)$22,148
Net income2,584————2,584
Other comprehensive income (loss)29———29—
Repurchase of common shares(678)—(1)(36)—(641)
Other changes(407)——(297)—(110)
Cash dividends declared preferred Series D, $8,875.00 per share(14)————(14)
Cash dividends declared common, $0.82 per share(576)————(576)
Balances as of March 31, 2025$31,202$—$140$11,037$(3,366)$23,391

See Notes to Consolidated Financial Statements.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Basis of Presentation

The Company

We are a global payments and premium lifestyle brand powered by technology. Founded in 1850 and headquartered in New York, American Express’ card-issuing, merchant-acquiring and card network businesses offer products and services to a broad range of customers, including consumers, small businesses, mid-sized companies and large corporations around the world. These products and services are offered through various channels, including mobile and online applications, affiliate marketing, customer referral programs, third-party service providers and business partners, in-house sales teams, direct mail, telephone and direct response advertising.

The accompanying Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2025 (the 2025 Form 10-K). If not materially different, certain note disclosures included therein have been omitted from these Consolidated Financial Statements.

The interim Consolidated Financial Statements included in this report have not been audited. In the opinion of management, all adjustments, which consist of normal recurring adjustments necessary for a fair statement of the interim Consolidated Financial Statements, have been made. Results of operations reported for interim periods are not necessarily indicative of results for the entire year.

The preparation of Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosures of contingent assets and liabilities. These accounting estimates reflect the best judgment of management, but actual results could differ.

Certain reclassifications of prior period amounts have been made to conform to the current period presentation.

We have updated our presentation and disclosure of Card Member loans and Card Member receivables to present them on a combined basis as Card balances. Results for the first quarter of 2026 and prior periods have been reclassified to conform to the new presentation. Previously, Card Member loans represented balances on our credit card products and revolve-eligible balances on our charge card products, which included balances that Card Members paid in full as well as balances that Card Members paid over time with interest, and Card Member receivables represented balances on our charge card products that need to be paid in full on or before the Card Member’s payment due date. The updated Card balances presentation includes both revolve-eligible balances and balances that need to be paid in full, reflecting the evolution of our card products over time, primarily due to the expansion of lending features on our charge card portfolio. This presentation change has no impact on the recognition or measurement of outstanding Card balances and associated reserves for credit losses.

Business Events

On February 25, 2026, we announced plans to build a new approximately 1.95 million square foot headquarters at 200 Greenwich Street (2 World Trade Center site) in New York City. In connection with the project, we have a commitment of up to $2.8 billion for the cost of construction. When the building goes into service, capitalized construction costs will be depreciated over the estimated useful life of the premises. We also recognized a finance lease liability of $370 million, which represents the present value of contractual fixed lease payments over the term of a land lease, and a corresponding increase to the right-of-use finance lease asset.

On January 12, 2026, we completed the acquisition of our partner’s interest in our Switzerland joint venture (Swisscard AECS GmbH). Upon acquisition, we recognized within our International Card Services (ICS) segment $272 million of intangible assets, which will be amortized over an estimated weighted average useful life of approximately eight years, $136 million of Goodwill and a gain for the remeasurement of our existing ownership interest. The allocation of the purchase consideration for the acquisition is preliminary as certain estimates related to the valuation of assets and liabilities are subject to finalization. Additionally, we now consolidate a variable interest entity (VIE), Swiss Payments Assets AG, which securitizes Card balances arising from Swisscard’s business to provide for the issuance of collateralized debt securities to third party investors; such consolidation is not material to our Consolidated Financial Statements.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Recently Issued Accounting Standards

In November 2024 and as amended in January 2025, the Financial Accounting Standards Board issued updated accounting guidance on the Disaggregation of Income Statement Expenses for annual reporting periods beginning after December 15, 2026 and for interim reporting periods beginning December 15, 2027, with early adoption permitted. The updated guidance includes the requirement for a new tabular disclosure within a Note to the Consolidated Financial Statements, to disaggregate defined expense categories from the expense report lines presented on the Consolidated Statements of Income. We are currently assessing the updated guidance; however, it is not expected to have a material impact to our Consolidated Financial Statements.

In September 2025, the Financial Accounting Standards Board issued updated guidance on accounting for internal-use software, effective for annual reporting periods beginning after December 15, 2027, with early adoption permitted. The amendments modernize guidance to consider different methods of software development, updating the requirements for capitalization of software costs. We are currently assessing the updated guidance; however, it is not expected to have a material impact to our Consolidated Financial Statements.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

2. Card Balances and Other Loans

Our card products that we offer to consumer, small business and corporate customers result in the generation of Card balances. We also extend credit to customers through financing products that are not associated with a Card Member agreement, and instead are governed by a separate borrowing relationship, resulting in Other loans.

Card balances and Other loans as of March 31, 2026 and December 31, 2025 consisted of:

Table 2.1: Card Balances and Other Loans

(Millions)20262025
Consumer (a)$140,908$144,324
Small Business55,09853,632
Corporate (a)17,30615,907
Card balances213,311213,863
Less: Reserves for credit losses6,0656,089
Card balances, net$207,247$207,774
Other loans, net (b)$10,535$10,605

(a)Includes approximately $33.4 billion of gross Card balances available to settle obligations of a consolidated variable interest entity (VIE) as of both March 31, 2026 and December 31, 2025.

(b)Other loans are presented net of reserves for credit losses of $314 million and $323 million as of March 31, 2026 and December 31, 2025, respectively.

Card Balances Aging

Generally, a Card Member account is considered past due if payment due is not received within 30 days after the billing statement date. The following table presents the aging of Card balances as of March 31, 2026 and December 31, 2025:

Table 2.2: Card Balances Aging

(Millions)Current30-59 Days Past Due60-89 Days Past Due90+ Days Past DueTotal90+ Days Past Due and Still Accruing Interest (a)Non-Accruals(b)
2026
Consumer$139,125$522$388$873$140,908$452$480
Small Business54,29525619435355,098136186
Corporate (c)(d)(d)(d)7117,306——
2025
Consumer142,552529392851144,324434471
Small Business$52,870$255$16834053,632130177
Corporate (c)(d)(d)(d)$75$15,907$—$—

(a)Our policy is generally to accrue interest through the date of write-off (typically 180 days past due). We establish reserves for interest that we believe will not be collected.

(b)Non-accrual Card balances primarily include certain Card balances placed with outside collection agencies for which we have ceased accruing interest.

(c)For corporate accounts, delinquency data is tracked based on days past billing status rather than days past due. A Card Member account is considered 90 days past billing if payment has not been received within 90 days of the Card Member’s billing statement date. In addition, if we initiate collection procedures on an account prior to the account becoming 90 days past billing, the associated Card balances are classified as 90 days past billing. These amounts are shown above as 90+ Days Past Due for presentation purposes. See also (d).

(d)Delinquency data for periods other than 90+ days past billing has not historically been available due to system constraints. Therefore, such data has not been a material input for risk management purposes. The balances that are current to 89 days past billing can be derived as the difference between the Total and the 90+ Days Past Due balances.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Other Loans Aging and Gross Write-Offs by Origination Year

Generally, a customer loan is considered past due if payment due is not received within 30 days after the payment due date. The following tables present the aging and gross write-offs for Other loans by year of origination as of or for the three months ended March 31, 2026, and as of or for the twelve months ended December 31, 2025:

Table 2.3: Other Loans Aging and Gross Write-Offs by Origination Year

2026 (Millions)20262025202420232022PriorRevolving Loans (a)Total
Current$1,465$4,505$1,716$338$34$57$2,670$10,785
30-59 Days Past Due—762——723
60-89 Days Past Due—652——721
90+ Days Past Due (b)—652—1720
Total (c)$1,465$4,524$1,731$344$35$59$2,691$10,849
Gross Write-Offs$—$16$18$7$1$—$24$66
2025 (Millions)20252024202320222021PriorRevolving Loans (a)Total
Current$5,532$2,172$494$45$6$54$2,564$10,867
30-59 Days Past Due672——1825
60-89 Days Past Due452———819
90+ Days Past Due (b)352——1617
Total (c)$5,545$2,188$500$46$6$56$2,587$10,928
Gross Write-Offs$15$77$47$13$1$—$88$242

(a)Revolving loans consist primarily of lines of credit offered to small business customers. Revolving loans include $5 million of term loans that were converted from revolving loans.

(b)Over 90 days past due includes $8 million and $7 million as of March 31, 2026 and December 31, 2025, respectively, of loans on which interest is still accruing. Our policy is generally to accrue interest through the date of write-off (typically 120 days past due) except for lines of credit offered to small business customers, where interest ceases to accrue at 90 days past due. We establish reserves for interest that we believe will not be collected.

(c)This total includes non-accrual loans of $19 million and $16 million as of March 31, 2026 and December 31, 2025, respectively. Non-accruals for consumer installment loans primarily include certain loans placed with outside collection agencies for which we have ceased accruing interest.

Credit Quality Indicators for Card Balances and Other Loans

The following table presents the key credit quality indicators as of or for the three months ended March 31, 2026 and 2025:

Table 2.4: Credit Quality Indicators for Card Balances and Other Loans

20262025
Net Write-Off RateNet Write-Off Rate
Principal Only (a)Principal, Interest & Fees (a)30+ Days Past Due as a % of TotalPrincipal Only (a)Principal, Interest & Fees (a)30+ Days Past Due as a % of Total
Card balances:
Consumer1.9%2.3%1.3%2.1%2.5%1.3%
Small Business2.4%2.7%1.5%2.3%2.6%1.4%
Corporate(b)0.7%(c)(b)0.5%(c)
Other loans2.0%2.1%0.6%2.2%2.3%0.6%

(a)We present a net write-off rate based on principal losses only (i.e., excluding interest and/or fees) to be consistent with industry convention. In addition, as our practice is to include uncollectible interest and/or fees as part of our total provision for credit losses, a net write-off rate including principal, interest and/or fees is also presented.

(b)Net write-off rate based on principal losses only is not available due to system constraints.

(c)For corporate Card balances, delinquency data is tracked based on days past billing status rather than days past due. Delinquency data for periods other than 90+ days past billing is not available due to system constraints. 90+ days past billing as a percent of total was 0.4% as of both March 31, 2026 and 2025.

Refer to Note 3 for additional indicators, including external qualitative factors, management considers in its evaluation process for reserves for credit losses.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Card Balances and Other Loans Restructurings for Borrowers Experiencing Financial Difficulty

We evaluate all Card balances and Other loans restructurings according to the accounting guidance for loan refinancing and restructuring to determine whether such loan modification should be accounted for as a new loan or a continuation of the existing loan. Our restructurings for borrowers experiencing financial difficulty are generally accounted for as a continuation of the existing loan, which reflects the ongoing effort to support our customers and recover our existing investments.

We offer several types of modification programs to customers experiencing financial difficulty, with the intention to minimize losses and improve collectability, while providing customers with temporary or permanent financial relief.

Such modifications primarily include (i) temporary interest rate reductions (reducing interest rates to as low as zero percent, in which case the balance is characterized as non-accrual), and/or (ii) placing the customer on a fixed payment plan not to exceed 60 months. Upon entering the modification program, the customer’s ability to make future purchases is limited, canceled or, in certain cases, suspended until the customer successfully exits from the modification program. As of March 31, 2026 and 2025, we had $21 million and $19 million, respectively, of unused credit available to customers with Card balances modified during each of the respective three month periods. In accordance with the modification agreement with the customer, Card balances and Other loans may revert to the original contractual terms (including the contractual interest rate where applicable) when the customer exits the modification program, which is either (i) when all payments have been made in accordance with the modification agreement or (ii) when the customer defaults out of the modification program.

The following table provides information relating to Card balances and Other loans modifications for borrowers experiencing financial difficulty during the three months ended March 31, 2026 and 2025:

Table 2.5: Card Balances and Other Loans Modifications for Borrowers Experiencing Financial Difficulty

Three Months Ended March 31,
20262025
Account Balances (Millions) (a)% of Total Class of Financing ReceivablesWeighted Average Interest Rate Reduction (% points)Weighted Average Payment Term Extensions (# of months)Account Balances (Millions) (a)% of Total Class of Financing ReceivablesWeighted Average Interest Rate Reduction (% points)Weighted Average Payment Term Extensions (# of months)
Interest Rate Reduction
Card balances
Consumer$6090.5%18.2%(b)$5450.5%18.4%(b)
Small Business2730.8%18.1%(b)2290.7%17.7%(b)
Corporate———(b)———(b)
Term Extension
Card balances
Consumer700.3%(b)32760.3%(b)31
Small Business1410.7%(b)311370.7%(b)29
Corporate120.1%(b)1050.03%(b)11
Other loans120.1%—18120.1%—17
Interest Rate Reduction and Term Extension
Other loans230.2%3.8%21170.2%3.1%21
Total$1,139$1,021

(a)Represents the outstanding balances as of March 31, 2026 and 2025, respectively, of all modifications undertaken in the current and preceding three months for balances that remain in modification programs as of, or that defaulted on or before, March 31, 2026 and 2025, respectively. The outstanding balances include principal, fees, and, where applicable, accrued interest. Modifications did not reduce the principal balance.

(b)For qualifying Card Member accounts, we offer either interest rate reductions or payment term extensions.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table provides information with respect to modified Card balances and Other loans that defaulted during the three months ended March 31, 2026 and 2025, and were modified in the twelve months prior to the payment default. A customer can miss up to three payments before being considered in default, depending on the terms of the modification program.

Table 2.6: Modified Card Balances and Other Loans that Defaulted within Twelve Months of Modification

Three Months Ended March 31,
20262025
Account Balance (Millions) (a)Interest Rate ReductionTerm ExtensionInterest Rate Reduction and Term ExtensionTotalInterest Rate ReductionTerm ExtensionInterest Rate Reduction and Term ExtensionTotal
Card balances
Consumer$46$5—5045$5—50
Small Business$2511—362211—33
Corporate$—1—1————
Other loans——22——11
Total$71$16$2$89$67$16$1$84

(a)Represents the outstanding balances as of March 31, 2026 and 2025, respectively, of all modifications that defaulted in the periods presented and were modified in the twelve months prior to payment default. The outstanding balances include principal, fees and, where applicable, accrued interest.

The following tables provide information relating to the performance of Card balances and Other loans that were modified during the prior twelve months and that remain in modification programs as of, or that defaulted on or before, March 31, 2026 and 2025:

Table 2.7: Performance of Modified Card Balances and Other Loans

As of March 31, 2026
Account Balances (Millions) (a)Current30-89 Days Past Due90+ Days Past Due
Card balances
Consumer1,94813049
Small Business1,00510631
Corporate1333
Other loans8952
Total$3,056$244$86
As of March 31, 2025
Account Balances (Millions) (a)Current30-89 Days Past Due90+ Days Past Due
Card balances
Consumer1,81211947
Small Business9419428
Corporate831
Other loans8151
Total$2,842$221$77

(a)The outstanding balances include principal, fees and where applicable, accrued interest.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

3. Reserves for Credit Losses

Reserves for credit losses represent our best estimate of the expected credit losses in our outstanding portfolios of Card balances as of the balance sheet date. The Current Expected Credit Loss (CECL) methodology requires us to estimate lifetime expected credit losses by incorporating historical loss experience, as well as current and future economic conditions over a reasonable and supportable period (R&S Period), which is approximately three years, beyond the balance sheet date. We make various judgments combined with historical loss experience to determine a reserve rate that is applied to the outstanding balance to produce a reserve for expected credit losses.

We use a combination of statistically-based models that incorporate current and future economic conditions throughout the R&S Period. The process of estimating expected credit losses is based on several key models: Probability of Default (PD), Exposure at Default (EAD) and future recoveries for each month of the R&S Period. Beyond the R&S Period, we estimate expected credit losses by immediately reverting to long-term average loss rates.

  • PD models are used to estimate the likelihood an account will be written-off.

  • EAD models are used to estimate the balance of an account at the time of write-off. This includes balances less expected repayments based on historical payment and revolve behavior, which vary by customer. Due to the nature of revolving loan portfolios, the EAD models are complex and involve assumptions regarding the relationship between future spend and payment behaviors.

  • Recovery models are used to estimate amounts that are expected to be received from Card Members after default occurs, typically as a result of collection efforts. Future recoveries are estimated taking into consideration the time of default, time elapsed since default and macroeconomic conditions.

We also estimate the likelihood and magnitude of recovery of previously written off accounts considering how long ago the account was written off and future economic conditions, even if such expected recoveries exceed expected losses. Our models are developed using historical loss experience covering the economic cycle and consider the impact of account characteristics on expected losses. This history includes the performance of modifications for borrowers experiencing financial difficulty, including their subsequent defaults.

Future economic conditions that are incorporated over the R&S Period include multiple macroeconomic scenarios provided to us by an independent third party. Management reviews these economic scenarios each period and assigns probability weights to each scenario, generally with a consistent initial distribution. At times, due to macroeconomic uncertainty and volatility, management may apply judgment and assign different probability weights to scenarios. These macroeconomic scenarios contain certain variables, including unemployment rates and real gross domestic product (GDP), that are significant to our models.

We also evaluate whether to include qualitative reserves to cover losses that are expected but, in our assessment, may not be adequately represented in the quantitative methods or the economic assumptions. We consider whether to adjust the quantitative reserves (higher or lower) to address possible limitations within the models or factors not included within the models, such as external conditions, emerging portfolio trends, the nature and size of the portfolio, portfolio concentrations, the volume and severity of past due accounts, or management risk actions.

Lifetime losses for most of our balances are evaluated at an appropriate level of granularity, including assessment on a pooled basis where financial assets share similar risk characteristics, such as past spend and remittance behaviors, credit bureau scores where available, delinquency status, tenure of balance outstanding, amongst others. Credit losses on accrued interest are measured and presented as part of Reserves for credit losses on the Consolidated Balance Sheets and within the Provisions for credit losses in the Consolidated Statements of Income, rather than reversing interest income.

For Other loans, we use vintage-based historical performance to estimate expected credit losses over the life of the loan, net of recovery estimates. We also assess the need to establish a reserve for expected credit losses as it relates to our card network business, taking into account our historical loss experience and any collateral or other forms of credit enhancements from network participants. If our expected credit losses exceed our outstanding receivables from network participants, a portion of the reserve for credit losses is recorded within Other liabilities on our Consolidated Balance Sheets.

Card balances and Other loans are written off when we consider amounts to be uncollectible, which is generally determined by the number of days past due and is typically no later than 180 days past due for Card balances and 120 days past due for Other loans. Balances in bankruptcy or owed by deceased individuals are generally written off upon notification.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table reflects the range of macroeconomic scenario key variables available to us as of March 31, 2026 and December 31, 2025, respectively, which were used, in conjunction with other inputs, to calculate reserves for credit losses:

Table 3.1: Key Macroeconomic Variables

U.S. Unemployment RateU.S. GDP Growth (Contraction) (a)
March 31, 2026December 31, 2025March 31, 2026December 31, 2025
First quarter of 20265%4% - 6%3%5% - (3)%
Fourth quarter of 20264% - 8%4% - 8%3% - (4)%3% - 0.5%
Fourth quarter of 20274% - 8%4% - 8%2%2%
Fourth quarter of 20284% - 7%4% - 6%3% - 2%4% - 2%

(a)Real GDP quarter over quarter percentage change seasonally adjusted to annualized rates.

Changes in Card Balances Reserve for Credit Losses

Card balances reserve for credit losses decreased for the three months ended March 31, 2026, primarily driven by a sequential decrease in Card balances.

Card balances reserve for credit losses decreased for the three months ended March 31, 2025. Our reserves for the period ended March 31, 2025 reflected the quality of our premium customer base and the macroeconomic outlook.

The following table presents changes in the Card balances reserve for credit losses for the three months ended March 31, 2026 and 2025:

Table 3.2: Changes in Card Balances Reserve for Credit Losses

Three Months Ended March 31,
(Millions)20262025
Beginning reserves$6,089$5,850
Provisions (a)1,1871,047
Net write-offs (b)(1,213)(1,165)
Other (c)18
Ending reserves$6,065$5,740

(a)Provisions for principal, interest and fee reserve components. Provisions for credit losses includes reserve build (release) and replenishment for net write-offs.

(b)Net write-offs are presented less recoveries of $352 million and $294 million for the three months ended March 31, 2026 and 2025, respectively.

(c)Primarily includes foreign currency translation adjustments.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Changes in Other Loans Reserve for Credit Losses

Other loans reserve for credit losses decreased for the three months ended March 31, 2026, primarily driven by the performance of our Other loans portfolio.

Other loans reserve for credit losses increased for the three months ended March 31, 2025, primarily driven by a sequential increase in Other loans outstanding.

The following table presents changes in the Other loans reserve for credit losses for the three months ended March 31, 2026 and 2025:

Table 3.3: Changes in Other Loans Reserve for Credit Losses

Three Months Ended March 31,
(Millions)20262025
Beginning reserves$323$194
Provisions (a)48105
Net write-offs (b)
Principal(54)(53)
Interest and fees(3)(2)
Other——
Ending reserves$314$244

(a)Provisions for principal, interest and fee reserve components. Provisions for credit losses includes reserve build (release) and replenishment for net write-offs.

(b)Principal write-offs are presented less recoveries of $9 million and $7 million for the three months ended March 31, 2026 and 2025, respectively. Recoveries of interest and fees were not significant.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

4. Investment Securities

Investment securities principally include available-for-sale (AFS) debt securities carried at fair value on the Consolidated Balance Sheets. Unrealized losses attributable to credit deterioration are recorded in the Consolidated Statements of Income in Other loans Provision for credit losses. Unrealized gains and any portion of a security’s unrealized loss attributable to non-credit losses are recorded in the Consolidated Statements of Comprehensive Income, net of tax. We had accrued interest on our AFS debt securities totaling $9 million and $3 million as of March 31, 2026 and December 31, 2025, respectively, presented as Other assets on the Consolidated Balance Sheets.

Investment securities also include equity securities carried at fair value on the Consolidated Balance Sheets with unrealized gains and losses recorded in the Consolidated Statements of Income as Other, net expense.

Realized gains and losses are recognized upon disposition of the securities using the specific identification method and recorded in the Consolidated Statements of Income as Other, net expense.

The following is a summary of investment securities as of March 31, 2026 and December 31, 2025:

Table 4.1: Investment Securities

20262025
Description of Securities (Millions)CostGross Unrealized GainsGross Unrealized LossesEstimated Fair ValueCostGross Unrealized GainsGross Unrealized LossesEstimated Fair Value
Available-for-sale debt securities:
State and municipal obligations$53$1$(7)$47$54$1$(7)$48
U.S. Government agency obligations3——33——3
U.S. Government treasury obligations1,635—(7)1,6281381—138
Mortgage-backed securities (a)9——910——9
Foreign government bonds and obligations813——813717——717
Other (b)81——8181——81
Equity securities (c)54—(9)4454—(8)46
Total$2,648$2$(24)$2,625$1,056$2$(16)$1,043

(a)Represents mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac or Ginnie Mae.

(b)Represents investments in debt securities issued by Community Development Financial Institutions.

(c)Equity securities comprise investments in common stock and mutual funds.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table provides information about our AFS debt securities with gross unrealized losses and the length of time that individual securities have been in a continuous unrealized loss position as of March 31, 2026 and December 31, 2025:

Table 4.2: AFS Debt Securities with Gross Unrealized Losses by Duration

20262025
Less than 12 months12 months or moreLess than 12 months12 months or more
Description of Securities (Millions)Estimated Fair ValueGross Unrealized LossesEstimated Fair ValueGross Unrealized LossesEstimated Fair ValueGross Unrealized LossesEstimated Fair ValueGross Unrealized Losses
State and municipal obligations$—$—$25$(7)$—$—$26$(7)
U.S. Government treasury obligations1,515(7)——————
Total$1,515$(7)$25$(7)$—$—$26$(7)

The gross unrealized losses on our AFS debt securities are primarily attributable to an increase in the current benchmark interest rate. Overall, for the AFS debt securities in gross unrealized loss positions, (i) we do not intend to sell the securities, (ii) it is more likely than not that we will not be required to sell the securities before recovery of the unrealized losses, and (iii) we expect that the contractual principal and interest will be received on the securities. We concluded that there was no credit loss attributable to the securities in an unrealized loss position for the periods presented.

Contractual maturities for AFS debt securities with stated maturities as of March 31, 2026 were as follows:

Table 4.3: Contractual Maturities of AFS Debt Securities

(Millions)CostEstimated Fair Value
Due in 1 year or less$902$902
Due after 1 year through 5 years1,6431,637
Due after 5 years through 10 years77
Due after 10 years4336
Total$2,595$2,581

The expected payments on state and municipal obligations, U.S. Government agency obligations and mortgage-backed securities may not coincide with their contractual maturities because the issuers have the right to call or prepay certain obligations.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

5. Asset Securitizations

We periodically securitize Card balances arising from our card businesses through the transfer of those assets to securitization trusts, American Express Credit Account Master Trust (the Lending Trust) and American Express Issuance Trust II (the Charge Trust and together with the Lending Trust, the Trusts). The Trusts then issue debt securities collateralized by the transferred assets to third-party investors.

The Trusts are considered VIEs as they have insufficient equity at risk to finance their activities, which are to issue debt securities that are collateralized by the underlying Card balances. We perform the servicing and key decision making for the Trusts, and therefore have the power to direct the activities that most significantly impact the Trusts’ economic performance, which are the collection of the underlying Card balances. In addition, we hold all of the variable interests in both Trusts, with the exception of the debt securities issued to third-party investors. Our ownership of variable interests in the Lending Trust was $13.6 billion and $14.9 billion as of March 31, 2026 and December 31, 2025, respectively, and in the Charge Trust was $6.2 billion and $5.7 billion as of March 31, 2026 and December 31, 2025, respectively. These variable interests held by us provide us with the right to receive benefits and the obligation to absorb losses, which could be significant to both the Lending Trust and the Charge Trust. Based on these considerations, we are the primary beneficiary of the Trusts and therefore consolidate the Trusts.

Restricted cash and cash equivalents held by the Lending Trust was $92 million and $84 million as of March 31, 2026 and December 31, 2025, respectively, and by the Charge Trust was nil as of both March 31, 2026 and December 31, 2025. These amounts relate to collections of Card balances to be used by the Trusts to fund future expenses and obligations, including interest on debt securities, credit losses and upcoming debt maturities.

Under the respective terms of the Lending Trust and the Charge Trust agreements, the occurrence of certain triggering events associated with the performance of the assets of each Trust could result in payment of trust expenses, establishment of reserve funds, or, in a worst-case scenario, early amortization of debt securities. During the three months ended March 31, 2026 and the year ended December 31, 2025, no such triggering events occurred.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

6. Customer Deposits

As of March 31, 2026 and December 31, 2025, customer deposits were categorized as interest-bearing or non-interest-bearing as follows:

Table 6.1: Interest-bearing and Non-Interest-bearing Customer Deposits

(Millions)20262025
U.S.:
Interest-bearing$156,726$151,425
Non-interest-bearing (includes Card Member credit balances of: 2026, $567; 2025, $556)610606
Non-U.S.:
Interest-bearing1818
Non-interest-bearing (includes Card Member credit balances of: 2026, $591; 2025, $436)594439
Total customer deposits$157,948$152,488

Customer deposits by deposit type as of March 31, 2026 and December 31, 2025 were as follows:

Table 6.2: Customer Deposits by Type

(Millions)20262025
U.S. interest-bearing deposits:
Savings accounts$121,257$116,867
Checking accounts3,2832,965
Certificates of deposit:
Direct7,2805,979
Third-party (brokered)9,3959,919
Sweep accounts – Third-party (brokered)15,51115,696
Total U.S. interest-bearing deposits$156,726$151,425
Other deposits6571
Card Member credit balances1,157992
Total customer deposits$157,948$152,488

The scheduled maturities of certificates of deposit as of March 31, 2026 were as follows:

Table 6.3: Scheduled Maturities of Certificates of Deposit

(Millions)20262027202820292030ThereafterTotal
Certificates of deposit (a)$4,113$7,256$2,762$671$1,879$5$16,686

(a)Includes $11 million of non-U.S. direct certificates of deposit as of March 31, 2026.

As of March 31, 2026 and December 31, 2025, certificates of deposit in denominations that met or exceeded the insured limit were $2.4 billion and $2.0 billion, respectively.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

7. Contingencies

In the ordinary course of business, we and our subsidiaries are subject to various pending and potential legal actions, arbitration proceedings, claims, investigations, examinations, regulatory proceedings, information gathering requests, subpoenas, inquiries and matters relating to compliance with laws and regulations (collectively, legal proceedings).

Based on our current knowledge, and taking into consideration our litigation-related liabilities, we do not believe we are a party to, nor are any of our properties the subject of, any legal proceeding that would have a material adverse effect on our consolidated financial condition or liquidity. However, in light of the uncertainties involved in such matters, including the fact that some pending legal proceedings are at preliminary stages or seek an indeterminate amount of damages, penalties or fines, it is possible that the outcome of legal proceedings could have a material impact on our results of operations. Certain legal proceedings involving us or our subsidiaries are described below.

On September 30, 2024, we were named as a defendant in a case filed in the United States District Court for the District of Massachusetts, captioned Pizza Hazel, Inc., et al. v. American Express Co., et al., in which plaintiffs allege that the anti-steering and non-discrimination provisions in our merchant agreements violate federal antitrust law and that the arbitration provision in our merchant agreements violates federal antitrust law to the extent it prevents antitrust challenges to our anti-steering and non-discrimination provisions. Plaintiffs seek, on behalf of themselves and a class of merchants that accept through the OptBlue Program, unspecified damages and an injunction prohibiting us from enforcing our anti-steering and non-discrimination provisions and prohibiting us from enforcing our arbitration provision to the extent the arbitration provision prevents antitrust challenges to our anti-steering and non-discrimination provisions. The court rejected our motion to compel the case to arbitration; we have appealed the decision to the Court of Appeals for the First Circuit.

On March 21, 2024, we were named as a defendant in a case filed in the United States District Court for the District of Rhode Island, captioned 5-Star General Store aka Bento LLC, et al. v. American Express Co., et al., in which plaintiffs allege that the anti-steering and non-discrimination provisions in our merchant agreements violate federal antitrust law and seek, on behalf of themselves and a class of merchants, an injunction prohibiting us from enforcing our anti-steering and non-discrimination provisions and a declaration that we have violated antitrust laws. The court rejected our motion to compel the case to arbitration; we have appealed the decision to the Court of Appeals for the First Circuit.

On January 29, 2019, we were named in a putative class action brought in the United States District Court for the Eastern District of New York, captioned David Moskowitz, et al. (formerly Oliver) v. American Express Company and American Express Travel Related Services Company Inc., in which the plaintiffs are holders of MasterCard, Visa and/or Discover credit and/or debit cards (but not American Express cards) and allege they paid higher prices as a result of the anti-steering and non-discrimination provisions in our merchant agreements in violation of federal antitrust law and the antitrust and consumer laws of various states. Plaintiffs seek unspecified damages and other forms of relief. The court dismissed plaintiffs’ federal antitrust claim, numerous state antitrust and consumer protection claims and their unjust enrichment claim. For the remaining state antitrust or consumer protection claims, the court certified classes for (i) holders of Visa and MasterCard debit cards in eight states and Washington, D.C.; and (ii) holders of Visa, MasterCard and Discover credit cards that do not offer rewards or charge an annual fee in two states and Washington, D.C. After trial in August 2025, the jury returned a verdict finding in favor of us on all claims except an Illinois consumer law claim for the class of non-rewards credit card holders in Illinois for which the jury awarded $12.5 million in damages. We have reached an agreement with the class representatives to settle all claims in this action, which is subject to court approval.

On March 8, 2016, plaintiffs B&R Supermarket, Inc. d/b/a Milam’s Market and Grove Liquors LLC, on behalf of themselves and others, filed a suit, captioned B&R Supermarket, Inc. d/b/a Milam’s Market, et al. v. Visa Inc., et al., for violations of the Sherman Antitrust Act, the Clayton Antitrust Act, California’s Cartwright Act and unjust enrichment in the United States District Court for the Northern District of California, against American Express Company, other credit and charge card networks, other issuing banks and EMVCo, LLC. Plaintiffs allege that the defendants, through EMVCo, conspired to shift liability for fraudulent, faulty and otherwise rejected consumer credit card transactions from themselves to merchants after the implementation of EMV chip payment terminals. Plaintiffs seek damages and injunctive relief. On May 4, 2017, the California court transferred the case to the United States District Court for the Eastern District of New York. On August 28, 2020, the court granted plaintiffs’ motion for class certification. On August 14, 2024, the court granted our motion to compel arbitration as to class members who are subject to our merchant agreements, but did not stay the claims pending arbitration. On November 15, 2024, we appealed to the Court of Appeals for the Second Circuit requesting a stay of all claims against us that are subject to arbitration. On March 31, 2025, we reached an agreement with the class representatives to settle this action, which is subject to court approval.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

On October 16, 2025, KServicing Wind Down Corp., the post-bankruptcy wind-down estate of Kabbage, Inc. (Kabbage), filed an action against American Express Kabbage Inc. and American Express Travel Related Services Company, Inc., captioned KServicing Wind Down Corp, et al. v. American Express Kabbage Inc. (f/k/a Alpha Kabbage, Inc.) and American Express Travel Related Services Company, Inc., in the United States Bankruptcy Court for the District of Delaware, seeking to recover up to approximately $746 million. The complaint alleges that our acquisition of Kabbage’s lending platform and other specified assets and liabilities included a fraudulent transfer that left Kabbage insolvent due to Kabbage’s liabilities, including those owed to the Department of Justice and Small Business Administration arising from Kabbage’s participation in the Paycheck Protection Program. The complaint seeks to avoid the alleged fraudulent transfer and recover the value of that transfer from us. A separate complaint seeking to recover some or all of the same amount was also filed on October 16, 2025 against certain of Kabbage’s former directors, officers and shareholders, who have taken the position that we must indemnify them for any resulting liability (which we dispute).

We are being challenged in a number of countries regarding our application of value-added taxes (VAT) to certain of our international transactions, which are in various stages of audit, or are being contested in legal actions. While we believe we have complied with all applicable tax laws, rules and regulations in the relevant jurisdictions, the tax authorities may determine that we owe additional VAT. In certain jurisdictions where we are contesting the assessments, we were required to pay the VAT assessments prior to contesting.

Our legal proceedings range from cases brought by a single plaintiff to class actions with millions of putative class members to governmental proceedings. These legal proceedings involve various lines of business and a variety of claims (including, but not limited to, common law tort, contract, application of tax laws, antitrust and consumer protection claims), some of which present novel factual allegations and/or unique legal theories. While some matters pending against us specify the damages sought, many seek an unspecified amount of damages or are at very early stages of the legal process. Even when the amount of damages claimed against us are stated, the claimed amount may be exaggerated and/or unsupported. As a result, some matters have not yet progressed sufficiently through discovery and/or development of important factual information and legal issues to enable us to estimate an amount of loss or a range of possible loss, while other matters have progressed sufficiently such that we are able to estimate an amount of loss or a range of possible loss.

We have accrued for certain of our outstanding legal proceedings. An accrual is recorded when it is both (a) probable that a loss has occurred and (b) the amount of loss can be reasonably estimated. There may be instances in which an exposure to loss exceeds the accrual. We evaluate, on a quarterly basis, developments in legal proceedings that could cause an increase or decrease in the amount of the accrual that has been previously recorded, or a revision to the disclosed estimated range of possible losses, as applicable.

For those disclosed legal proceedings where a loss is reasonably possible in future periods, whether in excess of a recorded accrual for legal or tax contingencies, or where there is no such accrual, and for which we are able to estimate a range of possible loss, the current estimated range is zero to $220 million in excess of any accruals related to those matters. This range represents management’s estimate based on currently available information and does not represent our maximum loss exposure; actual results may vary significantly. As such legal proceedings evolve, we may need to increase our range of possible loss or recorded accruals. In addition, it is possible that significantly increased merchant steering or other actions impairing the Card Member experience as a result of an adverse resolution in one or any combination of the disclosed merchant cases could have a material adverse effect on our business and results of operations.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

8. Derivatives and Hedging Activities

We use derivative financial instruments to manage exposures to various market risks. These instruments derive their value from an underlying variable or multiple variables, including interest rates and foreign exchange rates, and are carried at fair value on the Consolidated Balance Sheets. These instruments enable end users to increase, reduce or alter exposure to various market risks and, for that reason, are an integral component of our market risk management. We do not transact in derivatives for trading purposes.

A majority of our derivative assets and liabilities as of March 31, 2026 and December 31, 2025 are subject to master netting agreements with our derivative counterparties. Accordingly, where appropriate, we have elected to present derivative assets and liabilities with the same counterparty on a net basis in the Consolidated Balance Sheets.

In relation to our credit risk, certain of our bilateral derivative agreements include provisions that allow our counterparties to terminate the relevant agreement in the event of a downgrade of our debt credit rating below investment grade and settle the outstanding net liability position. As of March 31, 2026, these derivatives were not in a material net liability position. Based on our assessment of the credit risk of our derivative counterparties and our own credit risk as of March 31, 2026 and December 31, 2025, no credit risk adjustment to the derivative portfolio was required.

The following table summarizes the total fair value, excluding interest accruals, of derivative assets and liabilities as of March 31, 2026 and December 31, 2025:

Table 8.1: Fair Value of Derivative Assets and Liabilities

Other Assets Fair ValueOther Liabilities Fair Value
(Millions)2026202520262025
Derivatives designated as hedging instruments:
Fair value hedges - Interest rate contracts (a)$—$—$—$4
Net investment hedges - Foreign exchange contracts2232656699
Total derivatives designated as hedging instruments2232656702
Derivatives not designated as hedging instruments:
Foreign exchange contracts and other265148105418
Total derivatives, gross4881741611,120
Derivative asset and derivative liability netting (b)(143)(151)(143)(151)
Cash collateral netting (c)(37)(1)—(9)
Total derivatives, net$309$22$17$961

(a)For our centrally cleared derivatives, variation margin payments are legally characterized as settlement payments as opposed to collateral.

(b)Represents the amount of netting of derivative assets and derivative liabilities executed with the same counterparty under an enforceable master netting arrangement.

(c)Represents the offsetting of the fair value of bilateral interest rate contracts and certain foreign exchange contracts with the right to cash collateral held from the counterparty or cash collateral posted with the counterparty.

We posted $772 million and $756 million as of March 31, 2026 and December 31, 2025, respectively, as initial margin on our centrally cleared interest rate swaps; such amounts are recorded within Other assets on the Consolidated Balance Sheets and are not netted against the derivative balances.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Fair Value Hedges

We are exposed to interest rate risk associated with our fixed-rate debt obligations. At the time of issuance, certain fixed-rate long-term debt obligations are designated in fair value hedging relationships, using interest rate swaps, to economically convert the fixed interest rate to a floating interest rate. We had $39.6 billion and $36.7 billion of fixed-rate debt obligations designated in fair value hedging relationships as of March 31, 2026 and December 31, 2025, respectively.

The following table presents the gains and losses recognized in Interest expense on the Consolidated Statements of Income associated with the fair value hedges of our fixed-rate long-term debt for the three months ended March 31, 2026 and 2025:

Table 8.2: Gains and Losses associated with Fair Value Hedges on Fixed-rate Long Term Debt

Gains (losses)
Three Months Ended March 31,
(Millions)20262025
Fixed-rate long-term debt$222$(263)
Derivatives designated as hedging instruments(222)263
Total$—$—

The carrying values of the hedged liabilities, recorded within Long-term debt on the Consolidated Balance Sheets, were $39.6 billion and $37.0 billion as of March 31, 2026 and December 31, 2025, respectively, including the cumulative amount of fair value hedging adjustments of $144 million and $366 million for the respective periods.

We recognized in Interest expense on Long-term debt a net decrease of $16 million and an increase of $12 million for the three months ended March 31, 2026 and 2025, respectively, primarily related to the net settlements including interest accruals on our interest rate derivatives designated as fair value hedges.

Net Investment Hedges

A net investment hedge is used to hedge future changes in currency exposure of a net investment in a foreign operation. We primarily designate foreign currency derivatives (typically foreign exchange forwards) and, in certain cases, foreign currency-denominated debt, as hedging instruments to reduce our exposure to changes in currency exchange rates on net investments in foreign subsidiaries with non-U.S. dollar functional currency.

We had notional amounts of approximately $17.1 billion and $16.3 billion designated as net investment hedges as of March 31, 2026 and December 31, 2025, respectively. The gain or loss on these net investment hedges, net of taxes, recorded in Accumulated other comprehensive income (loss) (AOCI) as part of the cumulative translation adjustment, was a gain of $6 million and a loss of $198 million for the three months ended March 31, 2026 and 2025, respectively. Net investment hedge reclassifications out of AOCI into the Consolidated Statements of Income were not significant for both the three months ended March 31, 2026 and 2025.

Derivatives Not Designated as Hedges

The changes in the fair value of derivatives that are not designated as hedges are primarily intended to offset the related foreign exchange gains or losses of the underlying foreign currency exposures. We had notional amounts of approximately $33.1 billion and $39.0 billion as of March 31, 2026 and December 31, 2025, respectively. The changes in the fair value of the derivatives and the related underlying foreign currency exposures resulted in net gains of $15 million for both the three months ended March 31, 2026 and 2025, that are recognized in Other, net expenses in the Consolidated Statements of Income.

Our embedded derivative related to seller earnout shares granted to us upon the completion of a business combination in the second quarter of 2022 between our equity method investee, American Express Global Business Travel, and Apollo Strategic Growth Capital (C Ordinary Shares of GBT JerseyCo Limited) had a notional amount of $78 million as of both March 31, 2026 and December 31, 2025. The changes in the fair value of the embedded derivative resulted in losses of $9 million and $17 million for the three months ended March 31, 2026 and 2025, respectively, which were recognized in Service fees and other revenue in the Consolidated Statements of Income.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

9. Fair Values

Financial Assets and Financial Liabilities Carried at Fair Value

The following table summarizes our financial assets and financial liabilities measured at fair value on a recurring basis, categorized by GAAP’s fair value hierarchy, as of March 31, 2026 and December 31, 2025:

Table 9.1: Financial Assets and Financial Liabilities measured at Fair Value

20262025
(Millions)TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3
Assets:
Investment securities: (a)
Equity securities$44$44$—$—$46$46$—$—
Debt securities2,5814962,00481997—91681
Derivatives, gross (a)(b)488—4871174—16410
Total Assets3,1135402,491821,216461,08091
Liabilities:
Derivatives, gross (a)161—161—1,120—1,120—
Total Liabilities$161$—$161$—$1,120$—$1,120$—

(a)Refer to Note 4 for the fair values of investment securities and to Note 8 for the fair values of derivative assets and liabilities on a further disaggregated basis.

(b)Level 3 fair value reflects an embedded derivative. Management reviews and applies judgment to the valuation of the embedded derivative that is performed by an independent third party using a Monte Carlo simulation that models a range of probable future stock prices based on implied volatility in a risk neutral framework. Refer to Note 8 for additional information about this embedded derivative.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Financial Assets and Financial Liabilities Carried at Other Than Fair Value

The following tables summarize the estimated fair values of our financial assets and financial liabilities that are measured at amortized cost, and not required to be carried at fair value on a recurring basis, as of March 31, 2026 and December 31, 2025. The fair values of these financial instruments are estimates based upon the market conditions and perceived risks as of March 31, 2026 and December 31, 2025, and require management’s judgment. These figures may not be indicative of future fair values, nor can the fair value of American Express be estimated by aggregating the amounts presented.

Table 9.2: Fair Value of Financial Assets and Financial Liabilities measured at Amortized Cost

Carrying ValueCorresponding Fair Value Amount
2026 (Billions)TotalLevel 1Level 2Level 3
Financial Assets:
Financial assets for which carrying values equal or approximate fair value
Cash and cash equivalents (a)$54$54$52$2$—
Other financial assets (b)55—5—
Financial assets carried at other than fair value
Card balances and Other loans, less reserves (c)218223——223
Card balances HFS22——2
Financial Liabilities:
Financial liabilities for which carrying values equal or approximate fair value172172—172—
Financial liabilities carried at other than fair value
Certificates of deposit (d)1717—17—
Long-term debt (c)$58$59$—$59$—
Carrying ValueCorresponding Fair Value Amount
2025 (Billions)TotalLevel 1Level 2Level 3
Financial Assets:
Financial assets for which carrying values equal or approximate fair value
Cash and cash equivalents (a)$48$48$46$2$—
Other financial assets (b)44—4—
Financial assets carried at other than fair value
Card balances and Other loans, less reserves (c)218224——224
Card balances HFS22——2
Financial Liabilities:
Financial liabilities for which carrying values equal or approximate fair value166166—166—
Financial liabilities carried at other than fair value
Certificates of deposit (d)1616—16—
Long-term debt (c)$56$57$—$57$—

(a)Level 2 fair value amounts reflect time deposits and short-term investments.

(b)Includes other receivables and other miscellaneous assets.

(c)Includes amounts held by consolidated VIEs for which the fair values of Card balances were $33.3 billion and $33.2 billion as of March 31, 2026 and December 31, 2025, respectively, and the fair values of Long-term debt were $13.4 billion and $13.3 billion as of March 31, 2026 and December 31, 2025, respectively.

(d)Presented as a component of Customer deposits on the Consolidated Balance Sheets.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Nonrecurring Fair Value Measurements

We have certain assets that are subject to measurement at fair value on a nonrecurring basis. Equity investments without readily determinable fair values, which include investments in our Amex Ventures portfolio, are measured at fair value in periods subsequent to their initial recognition if they are determined to be impaired or where there is an observable price change for an identical or similar investment of the same issuer.

We generally estimate the fair value of these investments based on the observed transaction price. In addition, impairments on such investments are recorded to account for the difference between the estimated fair value and carrying value of an investment based on a qualitative assessment of impairment indicators such as business performance, general market conditions and the economic and regulatory environment. When an impairment triggering event occurs, the fair value measurement is generally derived by taking into account all available information, such as share prices of publicly traded peer companies, internal valuations performed by our investees, and other third-party fair value data. The fair value of these investments represents a Level 3 fair value measurement.

The carrying value of equity investments without readily determinable fair values totaled $1.2 billion and $1.1 billion as of March 31, 2026 and December 31, 2025, respectively, of which investments subject to nonrecurring Level 3 fair value measurement during the three months ended March 31, 2026 and the year ended December 31, 2025 totaled $62 million and $0.5 billion, respectively. These amounts are included within Other assets on the Consolidated Balance Sheets.

We recorded unrealized gains of $22 million and nil for the three months ended March 31, 2026 and 2025, respectively. Unrealized losses were $10 million and $39 million for the three months ended March 31, 2026 and 2025, respectively. Unrealized gains and losses are recorded in Other, net on the Consolidated Statements of Income. Since the adoption of new accounting guidance on the recognition and measurement of financial assets and financial liabilities on January 1, 2018, cumulative unrealized gains and losses for equity investments without readily determinable fair values totaled $1.2 billion and $0.5 billion as of March 31, 2026, respectively.

In addition, we also have certain equity investments measured at fair value using the net asset value practical expedient. Such investments were immaterial as of both March 31, 2026 and December 31, 2025.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

10. Changes In Accumulated Other Comprehensive Income (Loss)

AOCI is comprised of items that have not been recognized in earnings but may be recognized in earnings in the future when certain events occur. Changes in each component for the three months ended March 31, 2026 and 2025 were as follows:

Table 10.1: Changes in Accumulated Other Comprehensive Income (Loss)

(Millions), net of taxThree Months Ended,
March 31, 2026Net ChangeDecember 31, 2025March 31, 2025Net ChangeDecember 31, 2024
Net Unrealized Gains (Losses) on Debt Securities$(11)$(7)$(4)$(6)$3$(9)
Foreign Currency Translation Adjustment Gains (Losses), net of hedges (a)(2,805)(22)(2,783)(2,907)17(2,924)
Net Unrealized Pension and Other Postretirement Benefit Gains (Losses)(495)(5)(490)(453)9(462)
Accumulated Other Comprehensive Income (Loss)$(3,311)$(34)$(3,277)$(3,366)$29$(3,395)

(a)Refer to Note 8 for additional information on hedging activity.

The following table shows the tax impact for the three months ended March 31, 2026 and 2025 for the changes in each component of AOCI presented above:

Table 10.2: Tax Impact for Changes in Accumulated Other Comprehensive Income (Loss)

Tax expense (benefit)
Three Months Ended March 31,
(Millions)20262025
Net unrealized gains (losses) on debt securities$(1)$—
Foreign currency translation adjustment, net of hedges(9)(60)
Pension and other postretirement benefits12(1)
Total tax impact$2$(61)

Reclassifications out of AOCI into the Consolidated Statements of Income, net of taxes, for the three months ended March 31, 2026 and 2025 were not significant.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

11. Service Fees and Other Revenue and Other Expenses

The following is a detail of Service fees and other revenue for the three months ended March 31, 2026 and 2025:

Table 11.1: Components of Service Fees and Other Revenue

Three Months Ended March 31,
(Millions)20262025
Foreign currency-related revenue$480$382
Loyalty coalition, merchant and other service fees464436
Network partnership revenue449408
Delinquency fees255237
Travel commissions and fees150136
Other fees and revenues154123
Total Service fees and other revenue$1,951$1,722

The following is a detail of Other expenses for the three months ended March 31, 2026 and 2025:

Table 11.2: Components of Other Expense

Three Months Ended March 31,
(Millions)20262025
Data processing and equipment$767$705
Professional services545541
Other147400
Total Other expenses$1,459$1,646

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

12. Income Taxes

The effective tax rate was 21.4 percent and 22.4 percent for the three months ended March 31, 2026 and 2025, respectively. The decrease in the effective tax rate primarily reflected discrete tax benefits in the current period.

We are under continuous examination by the Internal Revenue Service (IRS) and tax authorities in other countries and states in which we have significant business operations. The tax years under examination and open for examination vary by jurisdiction. We are currently under examination by the IRS for the 2017 and 2018 tax years.

In December 2024, we received a Notice of Proposed Adjustment (Notice) from the IRS regarding transfer pricing between our U.S. and foreign subsidiaries for the 2017 and 2018 tax years currently under examination. The Notice proposes an increase to our U.S. taxable income that would result in an additional estimated U.S. federal income tax payment of approximately $185 million for 2017 and 2018, excluding interest and state income taxes, and asserts penalties of approximately $50 million for the same period. Although the Notice only applies to the 2017 and 2018 tax years currently under examination, the IRS may seek similar adjustments for subsequent tax years.

We strongly disagree with the IRS’s positions and plan to pursue all available remedies to vigorously contest the adjustments made by the IRS. We believe our income tax reserves are appropriate for all open tax years and that final resolution of this matter will not have a material impact on our results of operations. However, the ultimate outcome of this matter is uncertain, and if we are required to pay the IRS additional U.S. taxes, interest and/or potential penalties, our results of operations could be materially affected for the period in which the matter is resolved.

Tax Credit Investments

As of March 31, 2026 and 2025, we had $1,832 million and $1,699 million in tax credit investments, respectively, included in Other assets on the Consolidated Balance Sheets, comprised of Low Income Housing Tax Credit investments and other qualifying investments. We account for such tax credit investments using the Proportional Amortization Method.

The following table presents tax credit investment expenses and associated income tax credits and other income tax benefits for the three months ended March 31, 2026 and 2025:

Table 12.1: Tax Credit Investments Expenses and Credits

Three Months Ended March 31,
(Millions)20262025
Proportional amortization recognized in tax provision$(66)$(57)
Income tax credits and Other income tax benefits (a) recognized in tax provision7666

(a)Other income tax benefits are a result of tax deductible expenses generated by our tax credit investments

Income tax credits and other income tax benefits associated with our tax credit investments are also recognized in the Consolidated Statements of Cash Flows in the Operating activities section primarily under Accounts payable and other liabilities. Refer to Note 6 to our “Consolidated Financial Statements” in the 2025 Form 10-K for additional information on our tax credit investments for the year ended December 31, 2025.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

13. Earnings Per Common Share (EPS)

The computations of basic and diluted EPS for the three months ended March 31, 2026 and 2025 were as follows:

Table 13.1: Computation of Basic and Diluted Earnings per Share

Three Months Ended March 31,
(Millions, except per share amounts)20262025
Numerator:
Basic and diluted:
Net income$2,971$2,584
Preferred dividends(14)(14)
Net income available to common shareholders$2,957$2,570
Earnings allocated to participating share awards (a)(19)(18)
Net income attributable to common shareholders$2,938$2,552
Denominator:(a)
Basic: Weighted-average common stock685701
Add: Weighted-average stock options (b)11
Diluted686702
Basic EPS$4.29$3.64
Diluted EPS$4.28$3.64

(a)Our unvested restricted stock awards, which include the right to receive non-forfeitable dividends or dividend equivalents, are considered participating securities. Calculations of EPS under the two-class method exclude from the numerator any dividends paid or owed on participating securities and any undistributed earnings considered to be attributable to participating securities. The related participating securities are similarly excluded from the denominator.

(b)The dilutive effect of unexercised stock options excludes from the computation of EPS nil and 0.1 million of options for the three months ended March 31, 2026 and 2025, respectively, because inclusion of the options would have been anti-dilutive.

AMERICAN EXPRESS COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

14. Reportable Operating Segments

The following tables present certain selected financial information for our reportable operating segments and Corporate & Other as of or for the three months ended March 31:

Table 14.1: Selected Financial Information by Segment

Three Months Ended March 31, 2026 (Millions)USCSCSICSGMNSTotal Reportable Operating SegmentsCorporate & Other (a)Consolidated
Total non-interest revenues$5,803$3,408$3,164$1,825$14,200$15$14,215
Revenue from contracts with customers (b)3,9892,9311,9771,63110,528(11)10,517
Interest income4,0721,345728106,1555106,665
Interest expense751432360(169)1,3745991,973
Net interest income3,3219133671804,781(88)4,692
Total revenues net of interest expense9,1234,3213,5322,00418,980(73)18,907
Provisions for credit losses63138023841,253—1,251
Total revenues net of interest expense after provisions for credit losses8,4933,9413,2942,00017,728(73)17,656
Expenses
Card Member rewards, business development and Card Member services (c)4,6051,9861,5513068,44888,457
Marketing764311332651,47271,480
Salaries and employee benefits and other operating expenses1,3678286305143,3396023,941
Total expenses6,7363,1262,51388513,26061813,878
Pretax income (loss)$1,757$816$781$1,115$4,469$(691)$3,778
Total assets$119,517$66,076$50,180$19,353$255,126$53,769$308,894
Three Months Ended March 31, 2025 (Millions)USCSCSICSGMNSTotal Reportable Operating SegmentsCorporate & Other (a)Consolidated
Total non-interest revenues$5,243$3,265$2,646$1,660$12,814$(16)$12,798
Revenue from contracts with customers (b)3,6342,8281,6881,4859,635(9)9,626
Interest income3,7631,202596125,5735626,135
Interest expense757432306(143)1,3526141,966
Net interest income3,0067702901554,221(52)4,169
Total revenues net of interest expense8,2494,0352,9361,81517,035(68)16,967
Provisions for credit losses631329192(2)1,150—1,150
Total revenues net of interest expense after provisions for credit losses7,6183,7062,7441,81715,885(68)15,817
Expenses
Card Member rewards, business development and Card Member services (c)3,8821,7461,3122837,223127,235
Marketing765337300761,47881,486
Salaries and employee benefits and other operating expenses1,2397877514683,2455213,766
Total expenses5,8862,8702,36382711,94654112,487
Pretax income (loss)$1,732$836$381$990$3,939$(609)$3,330
Total assets$110,886$62,012$42,620$18,083$233,601$48,643$282,244

(a)Corporate & Other includes adjustments and eliminations for intersegment activity.

(b)Includes discount revenue and certain service fees and other revenue from customers.

(c)Card Member rewards, business development and Card Member services expenses are generally correlated to volumes or are variable based on usage.

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