Economy

American Express will cut 5% of its workers after a record quarter. Its CFO says it's to 'prepare for AI.'

Amex booked a $336 million restructuring charge as revenue hit a record $20.1 billion, its earnings release shows.

Stock photo. Photo by Vitaly Gariev on Unsplash

American Express will cut about 5% of its global workforce, CEO Stephen Squeri told analysts on Friday, Oct. 23, as the company reported record third-quarter revenue. Reuters and Bloomberg reported the cuts.

Amex has about 78,000 employees, Squeri told Bloomberg TV. That puts the cuts in the range of 3,500 to 3,900 jobs, based on outlets' estimates. The company has not said which countries, teams, or offices will lose jobs, or when workers will be told.

Record revenue, then the cuts

The same earnings release that set up the layoffs showed a strong quarter. Revenue hit a record $20.1 billion, up 9% from a year earlier, and net income rose 28% to $3.7 billion. Amex raised its full-year profit forecast.

The company booked a $336 million restructuring charge tied to what it calls "efficiency initiatives," paid for in part by a $982 million gain from selling its stake in Global Business Travel Group, according to its earnings release.

On the analyst call, Squeri said "we need to become a more agile and efficient organization," according to Fast Company. Chief financial officer Christophe Le Caillec told CNBC the restructuring is partly meant "to prepare for AI," Fast Company reported, by cutting layers of management so the company can automate more work.

Amex is the second big financial company this week to cut jobs while posting profits. Barclays announced about 5,000 cuts on Oct. 22.

If your job is on the list

Under the federal WARN Act, larger employers generally must give 60 days' written notice before a mass layoff or plant closing. Some states have their own WARN laws with broader coverage.

If Amex offers you a severance package, you don't have to sign it on the spot. Read the severance FAQ at severance.law and its guide on how much severance to ask for. If you're 40 or older, federal law gives you extra time to review the deal.

We condemn cutting thousands of jobs in a record quarter to fund an AI plan, while the workers who built that record pay the price.