American Airlines (AAL) Q3 2023 results

Robert Isom, CEO of American Airlines: I see robust demand through 2024

American Airlines reported a third-quarter loss on Thursday and cut its profit forecast for the year, partly in response to higher fuel prices.

The airline said Thursday that it expected profit of between $2.25 and $2.50 per share on an adjusted basis for the year, down from a July estimate of $3 to $3.75 -dollar, but largely in line with analysts’ expectations. American said it expected a full-year adjusted operating margin of 7%, down from a previous forecast of up to 10%.

For the fourth quarter, American estimated it would break even.

Here’s how American Airlines performed over the year third quarter compared to Wall Street’s expectations, based on an average of analyst estimates compiled by LSEG, formerly known as Refinitiv:

  • Adjusted earnings per share: 38 cents versus 25 cents expected
  • Total sales: $13.48 billion versus expected $13.52 billion

While airlines have seen a resurgence in travel since the end of the pandemic, particularly to international destinations, fares have largely fallen compared to last year.

American Airlines Boeing 787-9 Dreamliner taking off from Barcelona Airport on February 24, 2023 in Barcelona.

JanValls | Photo only | Getty Images

American expects fourth-quarter unit revenues to decline 5.5 to 7.5 percent year-over-year, with unit costs (excluding fuel) falling 5 to 7 percent year-over-year and capacity falling 4 percent year-over-year .5 to 6.5 percent will rise from 2022.

The company lost $545 million, or 83 cents per share, in the third quarter, compared with a profit of $483 million, or 69 cents per share, in the same period last year. It was the airline’s first loss since the first quarter of 2022. Capacity increased 7% year-on-year.

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CEO Robert Isom told employees in a note that “while there have been bumps along the way, such as significantly higher fuel costs resulting in lower earnings in the quarter, our team continues to excel at controlling everything we do.” “We can control what will make us successful no matter what the environment.”

Adjusted for higher costs related to the pilots’ new collective bargaining agreement, the company reported profit of $263 million, or 38 cents per share.

Sales increased by 0.1% compared to the same period last year.

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