American Airlines sees turbulence ahead, projects surprisingly big loss in Q1
Record sales for American Airlines aren’t enough to make up for the storm clouds on the horizon.
The company posted its highest annual revenue last year ($54.2 billion), but its shares are down almost 9% in early trading on its glum outlook for the current quarter.
Management forecast an adjusted loss per share of between $0.20 and $0.40 for Q1, significantly below the $0.04 loss analysts were expecting. That forecast looks even worse considering rival Delta Air Lines said it thinks it’s going to have its best year ever.
United Airlines had a similarly rosy Q1 profit outlook.
Still, American did see a big win from its credit cards: compensation surged to $6.1 billion last year, up 17% from 2023 from its deals with Citi and Barclays. Last month, the airline said it’s dropping Barclays to partner solely with Citi and expects its card payments to grow 10% annually. Delta’s doing about a billion dollars better in the credit-card business, pulling in $7.4 billion from AmEx in 2024.
Management forecast an adjusted loss per share of between $0.20 and $0.40 for Q1, significantly below the $0.04 loss analysts were expecting. That forecast looks even worse considering rival Delta Air Lines said it thinks it’s going to have its best year ever.
United Airlines had a similarly rosy Q1 profit outlook.
Still, American did see a big win from its credit cards: compensation surged to $6.1 billion last year, up 17% from 2023 from its deals with Citi and Barclays. Last month, the airline said it’s dropping Barclays to partner solely with Citi and expects its card payments to grow 10% annually. Delta’s doing about a billion dollars better in the credit-card business, pulling in $7.4 billion from AmEx in 2024.
