FORT WORTH- American Airlines (AA) reported a loss for the third quarter and revised its profit outlook for the year, citing higher fuel costs as a contributing factor.
The airline now anticipates earning between $2.25 and $2.50 per share on an adjusted basis for the year, which is a decrease from the July estimate of $3 to $3.75. However, this revised outlook is largely consistent with what analysts had expected.
American Airlines Third Quarter Results
American Airlines also lowered its adjusted operating margin forecast for the year to 7%, down from the previous expectation of as wide as 10%.
Here’s a comparison of American Airlines’ third-quarter performance with Wall Street’s projections, based on an average of analysts’ estimates from LSEG (formerly known as Refinitiv):
- Adjusted earnings per share: 38 cents, surpassing the expected 25 cents.
- Total revenue: $13.48 billion, slightly below the anticipated $13.52 billion.
In the third quarter, the company incurred a loss of $545 million, equivalent to 83 cents per share, which was a significant decline from the prior year’s profit of $483 million, or 69 cents per share.
After accounting for increased expenses related to a pilots’ labor agreement, the company’s adjusted earnings for the quarter amounted to $263 million, or 38 cents per share.
American Airlines is scheduled to conduct a conference call with analysts and the media at 8:30 a.m. on Thursday.
CEO Insights and More
“The American Airlines team continues to deliver impressive results,” stated Robert Isom, American’s CEO.
“Our team’s exceptional performance has set records for reliability and operational excellence. We are executing our plans effectively and are well-prepared for the future, thanks to the strength of our network, our modern and youthful fleet, and our exceptional team.”
During the third quarter, American Airlines achieved strong operational performance, reaching a record level of reliability during the peak summer travel period. The airline successfully operated over 515,000 flights during the quarter, maintaining an average load factor of 84%.
It achieved its best-ever third-quarter completion rate and ranked first among U.S. network carriers in terms of completion rate. American is committed to sustaining this positive momentum and ensuring reliable service for customers during the upcoming holiday travel season.
American Airlines achieved record third-quarter revenues of approximately $13.5 billion, driven by robust demand and revenue from co-brand credit cards and travel rewards programs.
The company experienced year-over-year corporate and government revenue growth in the third quarter, alongside continued strong demand and revenue from unmanaged business travel.
In the third quarter, the company reported an operating margin of (1.7%) and a net loss of $545 million on a GAAP basis.
Excluding net special items, American recorded an operating margin of 5.4% and net income of $263 million in the third quarter, surpassing the upper end of the company’s prior guidance.
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