American Airlines reported a $483 million profit for the third quarter and joined competitors in projecting strong travel demand as the airline industry continues to dismiss worries about an economic slowdown.
Despite operating almost 10% fewer flights than in 2019, American’s revenue increased to a record $13.46 billion in the three months that ended on September 30.
This is evidence that travellers are continuing to travel despite higher airfares. Sales for the quarter marginally exceeded analysts’ predictions.
After the airline released its financial results on Thursday, CEO Robert Isom wrote in a memo to staff, "Demand remains high, and it's evident that consumers continue to value air travel and the opportunity to connect post-pandemic."
Isom stated during an earnings call that the airline will probably return to 95% to 100% of its 2019 capacity the following year.
He claimed that this expansion is constrained by a delay in aircraft deliveries and a shortage of pilots for regional airlines.
American stated that it anticipates the strength to last through the holiday season.
It anticipates total income to increase by as much as 13% compared to the same period three years prior, before the Covid epidemic.
On Thursday, the company’s shares dropped 3.8% higher than the market as a whole.
According to Refinitiv consensus estimates, American performed as follows in the third quarter when compared to Wall Street expectations:
Earnings per share after adjustments: 69 cents, versus a forecast of 56 cents.
Total revenue came in at $13.46 billion versus $13.42 billion predicted.
Last week, American Airlines increased its revenue projection for the third quarter, which boosted stock prices.
The travel sector has had solid demand as customers continue to fly and, frequently, pay more fares than they did in 2019.
In comparison to three years prior, before the pandemic, all three main airlines have bragged about higher unit revenues, a trend that is assisting them in more than offsetting an increase in expenses.
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