A JetBlue Airways jet is available in for a landing after flights earlier were grounded during an FAA system outage at Laguardia Airport in Recent York City, Recent York, U.S., January 11, 2023.
Mike Segar | Reuters
JetBlue Airways shares jumped 12% on Tuesday after the airline posted a surprise profit and said it could defer one other $3 billion in aircraft spending through 2029 to enhance money flow.
The carrier posted a $25 million profit for the second quarter, down nearly 82% from last yr. Wall Street analysts had expected a quarterly loss.
JetBlue hasn’t posted an annual profit since before the pandemic. It has spent recent months cutting unprofitable routes and reducing costs to attempt to stop losing money because it faces higher expenses and an oversupplied domestic market.
JetBlue said Tuesday that it has halted 50 routes and is focusing more on service from Recent York, Recent England and Puerto Rico, where it has historically been strong. It is also trying to higher deploy its planes outfitted with premium seats like its Mint aircraft to maximise revenue.
JetBlue says the changes will help it add $800 million to $900 million in pretax benefit from 2025 through 2027.
It’s deferring delivery of 44 Airbus A321neo aircraft until 2030 or later. The airline has also been impacted by a Pratt & Whitney engine recall.
“Now we have and are taking aggressive motion on every front,” CEO Joanna Geraghty said on an earnings call on Tuesday.
Geraghty said Tuesday the airline is taking additional steps to enhance reliability, resembling adding more buffer time to flights. JetBlue has consistently ranked toward the underside of U.S. carriers in punctuality.
The airline plans to chop capability by as much as 6% within the third quarter and as much as 5% for the complete yr. Even with the reductions it expects third-quarter revenue to drop as much as 5.5% from last yr and full-year sales to be down as much as 6% over 2023.
Airline executives have blamed weaker-than-expected revenue this summer on an oversupply of capability.
Tuesday’s results and the investor reception was a win for Geraghty, a JetBlue veteran, who took the reins in February. Hours after she began in the highest role, activist investor Carl Icahn disclosed an almost 10% stake in the corporate. He won two board seats days later.
JetBlue and Spirit Airlines called off their merger agreement earlier this yr after the Recent York airline’s planned acquisition of the budget carrier was blocked by a federal judge. Each carriers have said they’re challenged in competing with larger rivals.
