American Airlines‘ first-quarter earnings outlook on Thursday fell in need of analysts’ estimates, sending its shares down nearly 9%.
The carrier forecast an adjusted loss per share of 20 cents to 40 cents for the primary three months of 2025 based on current demand trends and a fuel price forecast, a wider loss than the 4 cents analysts were expecting, in keeping with LSEG.
The airline said it expects unit costs, excluding fuel, to rise within the low-single-digit percentage points over the primary quarter of 2024 driven by lower capability, which it expects to fall as much as 2% over last 12 months; the next mixture of smaller, regional jet flying; and recent labor agreements it finalized last 12 months.
The earnings outlook contrasts with sunnier forecasts from rivals United and Delta earlier this month, though American’s full-year earnings forecast of between $1.70 and $2.70 is consistent with analysts’ estimates.
American spent much of the last 12 months working to reverse the fallout of a business travel sales strategy that pushed for direct bookings as an alternative of travel agencies. American has since abandoned that failed strategy and last 12 months said that previous approach would cost it $1.5 billion in 2024 revenue.
Nevertheless, it also sealed a recent bank card cope with its partner Citi. Compensation from its existing deals with Citi and Barclays rose 17% from 2023 to $6.1 billion last 12 months, American said.
“As we look forward to this 12 months, American stays well-positioned due to the strength of our network, loyalty and co-branded bank card programs, fleet and operational reliability, and the tremendous work of our team,” CEO Robert Isom said in a news release.
American said it expects revenue to be up between 3% and 5% in the primary quarter versus the identical period in 2024, and up as much as 7.5% for the total 12 months compared with 2024.
Here is how American performed within the fourth quarter compared with Wall Street estimates compiled by LSEG:
- Earnings per share: 86 cents adjusted vs. 64 cents
- Revenue:Â $13.66 billion vs. $13.40 billion expected
American’s fourth-quarter profit rose to $590 million from $19 million on sales that were up 4.6% on the 12 months to $13.66 billion. Each domestic and international revenue rose, led by a surge in trans-Pacific revenue.
Adjusted for one-time items, American earned 86 cents per share, greater than analysts expected. Special items last 12 months included the impact of labor contracts, a write-down of some regional aircraft and adjustments related to a few of its senior debt.
