American sees exceeding profit forecast as global demand grows

BLOOMBERG

American Airlines Group Inc said its second-quarter profit may exceed Wall Street projections as international demand builds headed into the peak summer season.
Adjusted profit will be $1.20 to $1.40 a share in the quarter, American said in a statement, compared with an expected $1.13 a share on average from analyst estimates compiled by Bloomberg. The company reiterated its outlook for a full-year adjusted profit of $2.50 to $3.50 a share.
The company, like its largest rivals, is seeing a rebound in flights outside the US after travellers pulled back on those trips last year when many Covid-related restrictions were still in place. The airline is devoting 80% of its capacity growth this quarter to long-haul international routes.
“We’re seeing a lot more bookings coming in a lot sooner,” for long-haul international flights, Chief Commercial Officer Vasu Raja said on a call with analysts.
American’s sales growth this year has trailed its biggest competitors, in part because of a pilot shortage at its regional airline partners and delays in deliveries, Chief Executive Officer Robert Isom said. The airline still has about 150 regional jets it can’t fly. Costs for each seat flown a mile, a measure of efficiency, will increase as much as 5.5% this quarter, while revenue on the same basis will decline 2% to 4%, American said. Flying capacity will also rise as much as 5.5%. In the first quarter, the airline reported adjusted profit of 5 cents a share, topping analysts’ estimates for about 4 cents.