American Airlines Flight 718, the first commercial flight of the United States’ Boeing 737 MAX since regulators lifted a 20-month ban in November, takes off from Miami, Florida on December 29, 2020.
Marco Bello | Reuters
American Airlines on Thursday reported a record quarterly loss and faces tough months ahead as new travel restrictions and a slow distribution of vaccines cloud hopes for a short-term recovery.
American posted a net loss of $ 2.2 billion in the fourth quarter. Revenues fell more than 64%, to $ 4.03 billion, compared to $ 11.3 billion. Sales were above analysts’ forecast of $ 3.88 billion for the quarter. The shares rose 47% in pre-market trading. American has much more equity in its shares than other American operators.
The Fort Worth, Texas-based airline said it expects capacity in the first quarter of 2021 to drop 45% compared to 2019, before the coronavirus pandemic undermines travel demand. She expects revenues to be 60% to 65% lower in the first quarter compared to the same months in 2019.
Here is American’s performance in the fourth quarter, compared to what Wall Street expected, based on the average estimates compiled by Refinitiv:
- Adjusted EPS: a loss of $ 3.86 against an expected loss of $ 4.11.
- Revenue: $ 4.03 billion versus expected $ 3.88 billion in revenue.
American Airlines executives will discuss the company’s results and prospects in a conference call at 8:30 am Eastern Time.
Southwest Airlines on Thursday reported its first annual loss since 1972 and said it would remain conservative with capacity until March, citing weak demand.
Dallas-based Southwest expects an average cash burn of around $ 17 million a day in the first quarter, “as a result of the continued slowdown in demand and a seasonally weaker travel period in January and February 2021, as well as rising fuel prices “. That’s over $ 12 million a day for the last three months of 2020.
January revenue is forecast to fall by 65% to 70% compared to 2019, slightly better than a decline of up to 75% that it predicted after stabilization of cancellations. Southwest said February revenues are likely to drop 65% to 75% compared to the same month in 2019.