United Airlines on Tuesday reported higher second-quarter revenue and narrowed its losses thanks to a resurgence in air travel, the latest carrier to issue a brightening outlook for one of the pandemic’s most battered sectors.
The Chicago-based airline said it expects to generate positive adjusted pretax income for the third and fourth quarters and that it plans to ramp up flying in response to higher travel demand. Delta Air Lines and American Airlines last week also said they have seen an improvement in bookings and financial results.
Here’s how United performed in the second quarter compared with what Wall Street expected, based on average estimates compiled by Refinitiv:
- Adjusted results per share: a loss of $3.91, in line with expectations.
- Total revenue: $5.47 billion versus expected $5.37 billion in revenue.
United’s revenue of $5.47 billion for the three months ended June 30, was down by more than 50% from the same quarter of 2019 but up nearly 70% from the first quarter of the year as U.S. officials rolled out Covid vaccines the spring and more travelers returned to air travel.
However, United still posted a net loss of $434 million for the second quarter. In the first three months of the year, United lost nearly $1.4 billion. The airline said it recorded $1.1 billion in income from a federal payroll grant, part of the $54 billion Congress set aside for U.S. airlines since March 2020.
United’s shares were down more than 1% in afterhours trading.
Adjusting for one-time items, United posted a per-share loss of $3.91, in line with analysts’ estimates.
United said its capacity for the current quarter will be down 26% from 2019 levels. In the second quarter, it flew 46% less than in 2019. It said its cost per seat mile, excluding fuel and other special charges, will likely be up 17% over the third quarter of 2019, partly due to flying shorter routes than usual and using smaller planes.
Airlines have reported a surge in bookings since this spring as vaccines rolled broadly, Covid cases fell and officials dropped pandemic-era restrictions.
United executives are scheduled to discuss the results and provide a more in-depth outlook on a 10:30 a.m. ET call Wednesday.
Analysts are expected to quiz airline management about trends in international and business travel bookings, two pillars of United’s business before the pandemic. The fast-spreading delta variant has raised concerns about renewed limits on travel.
On Monday, the State Department and Centers for Disease Control and Prevention advised against travel to the U.K. because of rising case counts.