Key Takeaways
- Block eliminated over 4,000 positions (approximately 40% of staff), attributing the decision to AI efficiency gains
- Concerns emerged that artificial intelligence may threaten legacy financial institutions like American Express
- Shares of American Express (AXP) declined nearly 8% during Friday’s trading session
- Significant bearish options activity emerged, with traders loading up on puts as the put-to-call ratio reached 2.6
- Year-to-date, AXP has fallen 11.39%, while implied volatility has surged
Shares of American Express $AXP plummeted nearly 8% during Friday’s session following Block’s disclosure of major workforce reductions that sent shockwaves through the financial services industry.
Block revealed plans to eliminate more than 4,000 positions, representing approximately 40% of its employee base. The disclosure came as part of the company’s fourth-quarter and full-year 2025 financial results.
In his shareholder letter, Block founder and CEO Jack Dorsey positioned the workforce reduction as a consequence of artificial intelligence enabling greater productivity. “A significantly smaller team, using the tools we’re building, can do more and do it better,” Dorsey explained.
He further noted that “intelligence tool capabilities are compounding faster every week,” suggesting this represents an ongoing transformation rather than an isolated restructuring event.
The implications were immediately felt across Wall Street. When a digitally-native fintech company like Block can operate with half its workforce thanks to automation, investors began questioning the vulnerability of traditional financial institutions.
This reasoning placed American Express squarely in investors’ sights. Even though the credit card giant has invested billions in technology infrastructure over recent decades, market participants viewed the company as potentially exposed to AI disruption.
The selloff was swift and decisive. AXP surrendered nearly 8% of its value throughout the session, settling at $307.95. Intraday trading ranged between $307.67 and $321.01.
Options Activity Reveals Heightened Anxiety
The equity decline was mirrored in derivatives markets, where bearish positioning intensified dramatically.
Approximately 22,400 put contracts traded on Friday, representing roughly five times typical daily volume. The majority of this activity centered on March and June 2026 $280 strike puts, with approximately 4,700 contracts executed at those strikes.
The put-to-call ratio surged to around 2.6, a clear indication that market participants were prioritizing downside protection over bullish bets.
At-the-money implied volatility increased by more than six points, signaling heightened expectations for significant price movements in AXP shares going forward.
The Bigger Picture
Friday’s decline represents just the latest setback for AXP shareholders. The stock has now surrendered 11.39% year-to-date, a challenging beginning to 2026 for shares that recently touched a 52-week peak of $387.49.
Typical daily volume averages approximately 3.1 million shares. Friday’s session saw only 379,000 shares change hands, indicating the decline was driven primarily by sentiment rather than wholesale dumping.
American Express maintains a market capitalization near $212 billion, operates with a gross margin of 60.65%, and offers shareholders a dividend yield of 1.06%.
The company’s technical indicators currently flash a “Buy” signal, though that hasn’t prevented the recent downturn.
AXP has deployed artificial intelligence throughout its operations for years and has successfully navigated numerous technological transitions throughout its history. Nevertheless, Block’s workforce announcement proved sufficient to trigger Friday’s exodus.
The concentration of put option activity in March and June 2026 expiration dates indicates traders are anticipating continued headwinds for AXP extending well into the middle of the year.
