New York City, NY – American Airlines reported a loss in the first quarter of the year but exceeded analysts’ expectations for the current period, leading to a 5% increase in shares on Thursday. The airline forecasts earnings between $1.15 and $1.45 per share for the second quarter, surpassing the $1.18 estimate. Additionally, it reiterated its full-year forecast of $2.25 to $3.25 per share.
CEO Robert Isom expressed confidence in the company’s ability to meet its financial targets for the year despite the first-quarter results. American Airlines anticipates a 7% to 9% increase in second-quarter capacity and expects unit revenues to decline by 1% to 3% from the previous year.
Similar to other airlines like Southwest, United, and Alaska, American Airlines has been affected by Boeing’s ongoing quality control and safety issues. The airline will receive fewer aircraft than initially planned, but Isom remains optimistic about the situation and does not expect significant disruptions due to the delays.
Isom emphasized the importance of Boeing addressing their challenges promptly during an interview with CNBC. He urged the aircraft manufacturer to improve its performance and fulfill their obligations to American Airlines.
In the first quarter, American Airlines reported a loss of $312 million or 48 cents per share, compared to a profit in the same period last year. Adjusted for one-time expenses, including new labor contracts, the loss amounted to $226 million or 34 cents per share. Operating expenses rose by nearly 7%, with a significant increase in salaries and related costs.
Despite these challenges, the company’s revenue increased by 3.1% to $12.57 billion in the first quarter. The financial performance reflects the ongoing impact of the aviation industry’s recovery from the pandemic and the various operational challenges faced by airlines.
Overall, American Airlines remains focused on achieving its financial goals and navigating the complexities of the current operating environment. The airline industry continues to adapt to changing conditions, with companies like American Airlines working to overcome obstacles and maintain stability in the market.