American airlines The airline slashed its profit forecast for the year after a sales strategy backfired and an industry-wide glut of flights forced airlines to discount prices, sending shares down more than 5% in premarket trading Thursday.
American Airlines said it expected adjusted earnings per share of 70 cents to $1.30 this year, well below its April forecast of $2.25 to $3.25 per share and below what Wall Street analysts expected, according to the London Stock Exchange. $1.10 to $2.60.
The Fort Worth, Texas-based airline also expects its third-quarter unit revenue to fall as much as 4.5% as high travel demand fails to make up for the excess flights.
The airline has been trying to roll back its direct-to-consumer policy Its sales strategy backfired. it says in one earnings release On Thursday, the company “took swift and aggressive action to realign its sales and distribution strategy” after receiving complaints from travel agents and customers.
American Airlines CEO Robert Isom said: “American Airlines has a fleet, network and products that can deliver results, but due to our previous sales and distribution strategies and domestic supply and demand imbalances, we The performance of the second season did not live up to initial expectations.
Here’s how American Airlines’ second-quarter performance compares to Wall Street forecasts compiled by the London Stock Exchange Group (LSEG):
- Earnings per share: Adjusted $1.09, expected $1.05
- income: US$14.33 billion, expected US$14.36 billion
Southwest’s second-quarter profit fell 46% to $717 million, or $1.01 per share, even as revenue rose 2% to $14.33 billion.
Adjusting for one-time items, the airline reported earnings of $1.09 per share.
The U.S. team’s results followed closely behind Southwest Airlines also Reported 46% drop It posted a quarterly profit and said it was taking “urgent” steps to boost revenue.
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