American Airlines sees revenue recovery but higher costs too

By AP News

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FORT WORTH, Texas (AP) — American Airlines said Tuesday that first-quarter revenue, while not back to pre-pandemic levels, will probably be better than Wall Street expected on strong travel demand. However, spending on labor and jet fuel are rising at the same time.

FORT WORTH, Texas (AP) — American Airlines said Tuesday that first-quarter revenue, while not back to pre-pandemic levels, will probably be better than Wall Street expected on strong travel demand. However, spending on labor and jet fuel are rising at the same time.

The mixed outlook from American could provide a hint of what other airlines will say when they begin reporting financial results for the quarter, starting with Delta Air Lines on Wednesday.

American said revenue will likely be down 16% from two years ago, slightly better than the 17% difference it had forecast earlier. That would work out to $8.89 billion, which is slightly above the $8.87 billion consensus among analysts were surveyed by FactSet.

The airline said spending in the quarter also would be slightly higher than it projected less than a month ago, and up to 13% above the same quarter of 2019. American has been adding workers after struggling with its operation at times last summer and fall. Fuel prices are also 7 cents per gallon higher than expected – not an insignificant amount, since the company estimated that 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.

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Author: AP News

This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

Originally published by Associated Press Valuethemarkets.com, Digitonic Ltd (and our owners, directors, officers, managers, employees, affiliates, agents and assigns) are not responsible for the content or accuracy of this article. The information included in this article is based solely on information provided by the company or companies mentioned above.

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