American Airlines (AAL) 2Q 2023 Earnings

American Airlines raised its revenue outlook for 2023 after a strong start to the peak travel season, the latest airline to reap the rewards of continued growth in demand.

The Fort Worth-Texas-based carrier expects to earn between $3 and $3.75 per share for the full year, adjusting for one-time items, up from a forecast of about $2.50 to $3.50 in May. The update to 2023 profit guidance is in line with Wall Street expectations of $3.10, according to the Refinitiv consensus estimate.

Airline executives are especially excited about travel demand for international travel. Some airfares are down from last year, when airlines struggled to rebuild their schedules after the worst of the pandemic, leaving travelers with fewer flights and seats.

American said on Thursday that it expects unit revenue to fall 6.5 percent in the third quarter from a year earlier, with capacity growth up 7 percent from the same period in 2022.

The company’s forecasts include spending on labor deals, such as a temporary contract with its pilots. However, the American Pilots Union is trying to improve its tentative contract after an agreement but rivals united and its pilots’ union last week.

Shares were little changed in premarket trading.

Here’s what American Airlines did. Second quarter Compared to Wall Street expectations based on an average of analyst estimates compiled by Refinitiv:

• Adjusted earnings per share: $1.92 vs $1.59 expected.
• Total Income: $14.06 billion versus the expected $13.74 billion

American reported net income of $1.34 billion, or $1.88 per share, in the second quarter, up from $476 million, or 68 cents per share, in the same period a year ago. Adjusting for one-time items, including costs associated with planes retired early in the pandemic, the company earned $1.37 billion, or $1.92 per share.

Record revenue of $14.06 billion topped analysts’ expectations and was up 4.7 percent from a year earlier.

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