American Airlines sees revenue recovery but also higher costs
FORT WORTH, Texas (AP) — American Airlines said Tuesday that first-quarter revenue, while not back to pre-pandemic levels, will likely be better than Wall Street expected due to strong travel demand. However, labor and jet fuel expenses are increasing at the same time.
American’s mixed outlook could give an idea of what other airlines will say when they start reporting their financial results for the quarter, starting with Delta Air Lines on Wednesday.
American said revenue would likely be down 16% from two years ago, slightly better than the 17% difference it had forecast earlier. That would be $8.89 billion, which is slightly above the consensus of $8.87 billion among analysts polled by FactSet.
The airline said spending for the quarter will also be slightly higher than it had forecast less than a month ago, and up to 13% above the same quarter of 2019. American added workers after sometimes having difficulties with its functioning last summer and autumn. Fuel prices are also 7 cents per gallon higher than expected — a not inconsiderable amount, since the company estimated it burned 895 million gallons in the first quarter.
Wall Street expects American, which is based in Fort Worth, Texas, to post a loss of $2.40 per share in the quarter when it reports results on April 21.
Shares of American Airlines Group Inc. rose about 1% in morning trading.
Copyright © 2022 . All rights reserved. This website is not intended for users located in the European Economic Area.