American Airlines Boosts Revenue Forecast as Travel Demand Remains Strong

American Airlines Group Inc. (AAL) is one of the world's largest airlines. It operates a mainline fleet of over 1,000 aircraft and a regional fleet of over 500 aircraft. The company has over 130,000 employees and operates in over 350 destinations worldwide.
The airline raised its revenue guidance for the recently ended quarter as demand for air travel remained strong through the holiday season, even as travelers contended with higher fares.
The guidance update offers a look at how a U.S. airline fared during a critical holiday travel period that saw thousands of canceled flights amid winter storms. This is one of the first looks at how an airline has fared during this difficult time.
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American Airlines, based in Fort Worth, Texas, has already expected fourth-quarter sales to be above pre-pandemic levels. On Thursday, the company said revenue would be 16% to 17% higher than the fourth quarter of 2019, up from its previous guidance of an increase of 11% to 13%.
Shares of American Airlines and United Airlines both rose more than 5% Thursday morning. Delta Air Lines shares were up about 4%.
Stock in American Airlines and Southwest Airlines rose by about 1.5% today.
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American Airlines' revenue per available seat mile for the upcoming quarter is expected to be 24% higher than 2019 levels, exceeding previous guidance. Airlines have raised prices from 2019 levels in response to surging fuel and labor costs. These higher prices have helped boost American Airlines' profit in the most recent quarter.
Adjusted earnings for the fourth quarter are expected to be $1.12 a share to $1.17 a share, which is above the 50 cents a share to 70 cents a share that the company had previously expected. Costs, excluding fuel and special items, are seen rising 10% above 2019 levels, which would reach the high end of the company’s guidance that was issued in October.
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The company said that it flew 6.1% less than in the same period in 2019, which is lower than the 5% to 7% capacity that it had expected.
American Airlines has announced that it has reduced its debt by $15 billion, more than half of its goal for 2025. Devon May, a company veteran, took over as American Airlines’ new chief financial officer earlier this month.
Delta Air Lines is set to release its fourth-quarter results on Friday.
U.S. airlines have been facing a number of disruptions in recent weeks. Winter storms led to thousands of cancellations last month, and issues with Southwest's crew-scheduling system resulted in thousands more. On Wednesday, the Federal Aviation Administration ordered a nearly two-hour nationwide "ground stop" that halted U.S. departures due to an outage with a federal pilot-alert system.