United States airlines report record profits

Although prices are significantly higher than last year, the three biggest U.S. airlines had a terrific summer and made over $2 billion in profits.

American Airlines announced a $483 million quarterly profit on Thursday as a result of record-breaking sales that more than offset rising fuel prices. American predicts that despite the fact that the rest of 2022 will be crowded with holidays, revenues will still surpass expectations set by Wall Street.

However, American’s performance could have outperformed its more prosperous rivals in terms of numbers. United Airlines reported a $942 million profit on Tuesday. At the same time, last week, Delta Air Lines announced third-quarter earnings of $695 million.

Having spent the most of the pandemic in isolation, it is obvious that many people are eager to resume driving. According to reports, executives from the three biggest U.S. airlines have provided no evidence that growing costs and uncertain economic conditions have an impact on ticket sales.

In a conference call with analysts and reporters, CEO Robert Isom said, “American’s third-quarter results, notably our record revenue performance, are impressive considering the macroeconomic uncertainty facing so many individuals.” Demand is still high.

American, with its headquarters in Fort Worth, Texas, anticipates fourth-quarter earnings of 50 to 70 cents per share, exceeding Wall Street’s forecast of 19 cents per share.

Air travel in the United States was reduced by the epidemic in early 2020, but it has since made a remarkable comeback. The 16th of October marked the busiest day at American airports since 2,500,000 passengers were scanned by TSA personnel in February 2020.

Despite a 43% increase in airfare over the previous year, the government reports that tourism is flourishing.

Because there aren’t as many flights as there used to be, customers have to fight for fewer tickets, which drives up rates.

American, for instance, flew about 10% less in the third quarter of 2019 compared to the same period in 2018.

American announced that it plans to operate at a level between 95% and 100% of what it did in 2019. The restoration of the complete schedule by next summer by Delta is consistent with this. The expansion of United’s European service will start in the summer of 2019.

Isom said that American might increase its flying schedule the next year, but it will exercise prudence. Early this year, a staffing shortage, notably among pilots, caused flight delays for American, Delta, and other airlines.

In terms of aircraft deliveries, if that’s the constraint, or pilots at a regional level or our capacity to train pilots, at American, he added, “We are going to make sure that we don’t outpace what we have.”

American posted a profit of 69 cents per share for the third quarter, vs the profit per share of 54 cents projected by FactSet analysts surveyed.

The amount of revenue climbed to $13.46 billion, just over the $13.36 billion estimate of industry analysts. American Airlines, which operates numerous flights to the Caribbean and has a sizable hub in Miami, reported losing close to $40 million in revenue in September as a result of hurricanes Fiona and Ian.