- Restored 'Apollo Belvedere' marble back on show in the Vatican
- Boeing to raise up to $25 bn as strike weighs on finances
- Oil prices fall on easing Middle East fears
- Boeing announces intention to raise up to $25 bn
- Ferguson to leave Man Utd ambassador role as club cuts costs
- Oil prices tumble on easing Middle East fears
- Oil prices hit by easing Middle East fears, most Asian markets rise
- Hopes pinned on peace across Taiwan Strait after drills
- Belgian pathologist and literary star gives 'voice to the dead'
- East Timor fights new battles 25 years after independence vote
- Oil prices drop on easing fears over Middle East, most markets rise
- Reoxygenating oceans: startups lead the way in Baltic Sea
- King Charles III heads to Australia and Commonwealth meeting
- Wall Street stocks hit fresh records as oil prices slide
- Strike-hit Boeing leaves experts puzzled by strategy
- NASA launches probe to study if life possible on icy Jupiter moon
- EVs seek to regain sales momentum at Paris Motor Show
- NASA probe Europa Clipper lifts off for Jupiter's icy moon
- 'Unsustainable' housing crisis bedevils Spain's socialist govt
- Stocks shrug off China disappointment but oil slides
- Stocks diverge, oil retreats as China disappoints markets
- Trio wins economics Nobel for work on wealth inequality
- Ex-Stasi officer jailed over 1974 Berlin border killing
- Shanghai stocks gain after stimulus briefing as markets rally
- Shanghai stocks gain after stimulus briefing as Asian markets rally
- Nearly 90, but opera legend Kabaivanska is still calling tune
- With inflation down, ECB eyes faster tempo of rate cuts
- Is life possible on a Jupiter moon? NASA goes to investigate
- Ex-Stasi officer faces verdict over 1974 Berlin border killing
- Role of government, poverty research tipped for economics Nobel
- In milestone, SpaceX 'catches' megarocket booster after test flight
- In a first, SpaceX 'catches' megarocket booster after test flight
- Bangladeshi Hindus shrug off attack worries to celebrate festival
- Ubisoft fears assassin's hit over falling sales
- Vietnam, China hold talks on calming South China Sea tensions
- SpaceX will try to 'catch' giant Starship rocket shortly before landing
- Japan's former empress Michiko discharged after surgery: reports
- Japan's former empress Michiko discharged after surgey: reports
- 'Little Gregory' murder haunts France 40 years on
- Tariffs, tax cuts, energy: What is in Trump's economic plan?
- Amazon wants to be everything to everyone
- Jewish school in Canada hit by gunfire for second time
- With medical report Harris seeks to play health card against Trump
- China-EU EV tariff talks in Brussels end with 'major differences': Beijing
- Buried Nazi past haunts Athens on liberation anniversary
- Harris to release medical report confirming fitness for presidency: campaign
- Nobel prize a timely reminder, Hiroshima locals say
- China offers $325 bn in fiscal stimulus for ailing economy
- Small Quebec company dominates one part of NHL hockey: jerseys
- Boeing to cut 10% of workforce as it sees big Q3 loss
RBGPF | 1.67% | 60.5 | $ | |
RYCEF | -0.57% | 6.99 | $ | |
SCS | 1.14% | 13.13 | $ | |
CMSC | 0.6% | 24.84 | $ | |
NGG | 0.68% | 67.35 | $ | |
GSK | -0.01% | 39.125 | $ | |
RIO | -1.94% | 66.41 | $ | |
RELX | 1.82% | 48.26 | $ | |
BTI | -0.01% | 35.445 | $ | |
CMSD | 0.68% | 25.151 | $ | |
VOD | -0.05% | 9.675 | $ | |
BCE | 2.7% | 33.465 | $ | |
BP | -3.77% | 30.829 | $ | |
JRI | 0.1% | 13.1 | $ | |
AZN | -0.66% | 77.585 | $ | |
BCC | 0.09% | 143.11 | $ |
Uncertain outlook weighs on American Airlines shares despite blowout Q2
American Airlines reported blowout second-quarter earnings on Thursday on strong demand and lower jet fuel prices, but shares still tumbled on disappointment with the company's outlook.
While the big US carrier lifted its full-year projections, Wall Street analysts said the fine print in the forecast suggested a greater ebbing of pricing strength compared with competitors.
The results follow robust reports last week from Delta Air Lines and on Wednesday from United Airlines, with the latter elaborating Thursday on its response to weather-related disruptions late last month at its Newark, New Jersey hub.
US carriers have enjoyed a heady second quarter, pointing to sizzling demand in a seasonally strong period boosted further by pent-up demand for travel following pandemic shutdowns.
Profits at American were nearly triple the year-ago level at $1.4 billion, while revenues rose 4.7 percent to $14.1 billion, a record.
Results were boosted by a retreat in jet fuel prices, which were down 35 percent from the year-ago level.
American Airlines Chief Executive Robert Isom said the results reflected "historically strong" operational performance and highlighted a two-notch upgrade in its credit rating by Fitch.
But analysts on a conference call questioned American's forecast, which implies a less impressive second half of 2023. The outlook includes anticipated effects of a new labor contract with higher pilot pay that is expected following union ratification.
American raised its full-year profit outlook to a range of $3.00 to $3.75 per share from $2.50 to $3.00. The third-quarter is forecast at between 85 and 95 cents per share.
The third-quarter outlook disappointed analysts, who noted that both Delta and United signaled greater gains for the same period.
That suggests Delta "is capitalizing on the trend towards pricier premium seats better than American is," said Briefing.com, which also noted that Delta's forecasts already incorporate higher labor costs after Delta pilots ratified a hefty increase earlier this year.
American's "pricing power is starting to erode," said Christopher Raite, an analyst at Third Bridge, who also pointed out that American described business travel as plateauing at about 80 percent of pre-pandemic levels.
Other carriers have not spelled out that problem, Raite said. What's more, American faces questions over its service in the northeastern United States due to the demise of a joint venture with JetBlue following an unfavorable US court ruling, he added.
- United trims Newark plans -
Meanwhile, United, which also reported record results on Wednesday night, spelled out more precisely the effects of flight disruptions at Newark just ahead of the July 4th holiday weekend.
Executives estimated a hit to profit margins of about one percentage point due to widespread flight cancelations and delays, along with a one percentage point drag on second-quarter capacity.
Besides improving coordination with federal air safety regulators, United has trimmed its flight schedule for the summer at Newark.
The airline normally schedules 435 flights per day at Newark over the summer.
At the outset of the summer of 2023, United planned 410 flights per day after the Federal Aviation Administration highlighted staffing constraints for the New York area, already the nation's busiest airspace.
But in the aftermath of the recent difficulties, United is trimming its August schedule to 390 per day, said Chief Commercial Officer Andrew Nocella.
Nocella said United also expects a "smaller schedule" at Newark in the summer of 2024 to improve reliability.
American shares dropped 6.2 percent to $17.44, while United gained 3.2 percent to $56.57.
Ch.Lefebvre--CPN