American Airlines Group Inc (NASDAQ: AAL) reported better-than-expected results for its fiscal third quarter and issued encouraging guidance on Thursday. Shares still remain little changed.
The air carrier had its quarterly revenue topped pre-pandemic by 13% even though capacity was still down 9.6% versus 2019. Speaking with CNBC’s Phil LeBeau, CEO Robert Isom said:
Demand is coming back strong in all respects. From a leisure perspective, shorthaul, international, but also business. And then there’s blended trips. Demand is out there and we’re doing a good job of servicing it.
He’s also convinced that the demand will remain strong even if the economy slips into a recession.
For the current financial quarter, American Airlines forecasts revenue to be ahead of 2019 levels by as much as 13% on a 5.0% to 7.0% lower capacity.
The air carrier is projecting its per-share earnings to fall between 50 cents and 70 cents in Q4 – significantly better than the 19 cents consensus. The Chief Executive added:
We’re taking a look at paid load factors. In our premium seats, 5.0% to 10% higher than they were pre-pandemic. It shows that customers want to treat themselves, they’re willing to do things, and we’re giving them a product they’re willing to pay for.
Heading into this stock market news, Wall Street had a consensus “hold” rating on American Airlines.
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