American Express Stock Falls Nearly 8% After Block’s Mass Layoffs Spark AI Disruption Fears

Key Takeaways

• Block announced layoffs of over 4,000 employees (approximately 40% of its workforce), citing AI-driven efficiency

• The news sparked fears that AI could disrupt traditional financial companies like American Express

• American Express stock fell nearly 8% on Friday

• Heavy put option activity showed traders bracing for further declines, with the put-to-call ratio hitting 2.6

• American Express is down 11.39% year-to-date, with implied volatility seen rising sharply

American Express stock dropped close to 8% on Friday, Feb. 27, 2026 after Block’s announcement of sweeping layoffs rattled investor confidence across the financial sector.

Image Source: KnockoutStocks

Block said it was cutting more than 4,000 jobs, roughly 40% of its total workforce. The company made the announcement alongside its fourth-quarter and full-year 2025 earnings report.

Block founder and CEO Jack Dorsey framed the cuts as a product of AI-powered efficiency. In a letter to shareholders, he wrote: “A significantly smaller team, using the tools we’re building, can do more and do it better.”

Dorsey added that “intelligence tool capabilities are compounding faster every week,” signaling this is not a one-time restructuring but part of a longer trend.

For investors, the message landed hard. If a tech-forward digital payments company like Block is slashing nearly half its staff due to automation, the thinking goes, what does that mean for older, more traditional players?

That question put American Express in the crosshairs. Despite being a well-established credit card giant with decades of tech investment behind it, the market treated the stock as vulnerable.

Investors sold off the stock quickly. American Express lost nearly 8% across the trading session, closing the week at $308.90. The day’s range ran from $307.67 to $321.01.

Options Market Signals More Concern

The selloff wasn’t just in the stock itself. The options market told a similar story.

Roughly 22,400 put contracts changed hands on Friday, about five times the normal daily volume. Much of that activity was concentrated on March and June 2026 $280 strike puts, with around 4,700 contracts at those levels.

The put-to-call ratio jumped to approximately 2.6. That’s a clear sign traders were paying up for downside protection, not optimism.

At-the-money implied volatility climbed by more than 6 points, reflecting rising expectations for future price swings in American Express.

Broader Context

Friday’s drop doesn’t exist in isolation. American Express is now down 11.39% year-to-date, quite a rough start to 2026 for a stock that hit a 52-week high of $387.49 not long ago.

Average daily trading volume runs at around 3.1 million. On Friday, volume came in at just 379,000, suggesting the move was driven more by fear than mass liquidation.

American Express has a market cap of roughly $212 billion, a gross margin of 60.65%, and a dividend yield of 1.06%. The company’s technical sentiment has signaled a “Buy,” though that didn't stop the stock from sliding.

American Express has long used AI within its own operations, and the company has adapted to technological shifts over many decades. Still, Block’s announcement was enough to send investors looking for the exits on Friday.

The put option activity, concentrated in the March and June 2026 timeframes, may suggest that the market is pricing in continued uncertainty for American Express well into mid-year.