American Airlines released its third-quarter financial results on Thursday, raising its profit forecast for 2024, despite reporting a third-quarter loss.
The airline attributes this optimistic outlook to a strategic shift in its sales approach earlier in the year, which CEO Robert Isom said is beginning to deliver positive results.
The company reported earnings of $0.30 per share versus $0.16 expected, while revenues came in at US$13.65 billion versus $13.50 billion expected.
The airline now anticipates earning between $0.25 and $0.50 per share on an adjusted basis for the fourth quarter, surpassing analysts' expectations of $0.29 per share.
For the full year, American Airlines projects adjusted earnings could reach up to $1.60 per share.
Earlier this year, American Airlines replaced its chief commercial officer following the failure of a sales strategy designed to boost direct bookings, which led the company to revert to a more traditional sales model.
Isom noted in the earnings release, “We have taken aggressive action to reset our sales and distribution strategy and reengage the business travel community, which we’re confident will improve our revenue performance over time. We have heard great feedback from travel agencies and corporate customers as we work to rebuild the foundation of our commercial strategy and make it easy for customers to do business with American.”
American's revenue increased by 1.2% to a record $13.65 billion for the quarter ending 30 September, despite a net loss of $149 million. This was an improvement from the $545 million loss reported a year earlier. However, the airline saw a 2% decline in unit revenue over the same period.
For the fourth quarter, American Airlines expects unit revenue to decrease by 1% to 3% compared to the previous year, while capacity is forecast to rise by up to 3% year-on-year.
As of 8:25 am (AEDT), Friday, October 25, American Airlines (AAL) stock was trading at US$12.78, showing a slight decrease of 0.4% from the previous close of $12.83. The stock reached a day low of $12.42 and a day high of $13.63. American Airline's market cap stands at US$8.39 billion.