Shares of credit card and payments company American Express (AXP 1.39%) fell sharply on Friday, even though there was no new company-specific disclosure from Amex itself. The selling pressure came amid a broader fear that AI (artificial intelligence) could trigger meaningful white-collar job disruption, eventually showing up in consumer spending trends and credit performance.
Is this sharp sell-off in the stock price, which has put shares down by about 15% year to date, a buying opportunity? Or should investors be taking the threat of AI to the job force more seriously, and now require a bigger discount on American Express stock before buying?
Image source: Getty Images.
A sudden AI layoff signal spooked the market
One reason investors were on edge Friday was news from Block (XYZ 7.42%), the payments company behind Square and Cash App. Block announced a major workforce reduction, and CEO Jack Dorsey framed it as a structural shift driven by AI tools.
"The core thesis is simple. Intelligence tools have changed what it means to build and run a company," Dorsey wrote in Block's shareholder letter. "A significantly smaller team, using the tools we're building, can do more and do it better."
He went a step further, saying he expects this to spread. "Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes."
That is a provocative claim, and it helps explain why credit and payments stocks sold off on Friday. If AI truly drives a wave of white-collar layoffs, the downstream effects could eventually reach everything from travel and discretionary spending to loan growth and credit losses
And as great as American Express's business is, it wouldn't be immune to a macroeconomic backdrop like this.
But American Express is not seeing it in the numbers yet.
Strong business momentum and upbeat guidance
American Express just finished a strong 2025. In its latest earnings release, the company reported full-year revenue (net of interest expense) of $72.2 billion, up 10% year over year.
Additionally, its credit trends remained strong. The company's full-year net write-off rate was 2%, and its fourth-quarter net write-off rate was 2.1%. In other words, any feared consumer stress simply is not visible in the company's most recent report.
The company also entered 2026 with a fairly confident outlook. Management said in its Jan. 30 financial update that it expects full-year 2026 revenue growth of 9% to 10% and earnings per share of $17.30 to $17.90. The midpoint of this guidance range implies 14% year-over-year growth.
A look at the stock's valuation
After Friday's sell-off, American Express was trading around the low-$300s. At the midpoint of its 2026 earnings-per-share guidance, the stock trades at roughly 18 times expected earnings.
That is not a wild valuation for a premium card network and lender with brand strength, scale, and steady earnings power. But it also isn't a valuation that screams "buy" either -- especially given a shifting job landscape from AI that is introducing uncertainty into the macroeconomic outlook.
If investors start believing that white-collar job disruption is a real near-term threat, they may simply demand a lower valuation multiple from American Express stock due to its consumer credit exposure.
NYSE: AXP
Key Data Points
So, is it time to sell?
I would not rush to sell the stock based solely on a narrative shift -- especially when American Express is still guiding to 9% to 10% revenue growth and double-digit earnings growth in 2026.
But I would treat Friday's move as a warning shot. For investors who already own the stock, I think it is reasonable to view it more as a hold than a buy at this price, given the increased uncertainty about the job market. The company is performing well, but Block's letter raises some valid points about the risks AI poses to the job market. At the very least, Block's letter to shareholders this week gives American Express investors something to keep an eye on.
