American Airlines says the first quarter was tough, with another big loss, but expects to turn a profit in the second quarter as more people return to travel
DALLAS — American Airlines lost $1.64 billion in the first quarter, a larger loss than a year ago, but said Thursday it expects to turn profitable in the spring as demand for travel picks up.
Shares of the airline were up more than 10% in early trading before the market opened.
Air traffic was moderated early in the year by the ommicron variant that caused an increase in COVID-19 cases, but passengers returned in March and American said it made a profit that month, excluding certain items.
Sales have more than doubled from a year earlier and returned to 84% of pre-pandemic levels in early 2019.
“The demand environment is very strong and so we expect to be profitable in the second quarter based on our current fuel price assumptions,” new CEO Robert Isom said in a statement from the Fort Worth, Texas-based airline.
American’s optimistic commentary about the remainder of 2022 echoed comments from Delta Air Lines and United Airlines, both of which forecast full-year profits as travel continues to recover from the depths of the pandemic.
However, the first quarter was less rosy. It started with massive flight cancellations due to winter storms and a large number of pilots and flight attendants using ommicron. Cancellations decreased and sales increased for the remainder of the quarter as the variant declined.
American said it lost $2.32 per share excluding special items, a slightly better result than the average forecast of an adjusted loss of $2.43 per share, according to a Zacks Investment Research survey of eight analysts.
Still, the loss was greater than American’s $1.25 billion loss a year earlier.
Sales rose to $8.9 billion.
Through Wednesday, American Airlines Group shares were up 8.5% since the beginning of the year. The stock has fallen just over 4% in the past 12 months.
This story was generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Visit a Zacks stock report on AAL at https://www.zacks.com/ap/AAL