By Tracy Rucinski CHICAGO (Reuters) -United Airlines reported its sixth consecutive quarterly loss on Tuesday due to the coronavirus pandemic, though revenue quadrupled from a year ago and topped estimates with a strong domestic travel rebound. U.S. leisure travel has nearly recovered to pre-pandemic levels as more people fly for vacation or to visit friends […]
United Airlines revenue tops estimates as travel rebounds, sees 3rd-quarter turning point
By Tracy Rucinski
CHICAGO (Reuters) -United Airlines reported its sixth consecutive quarterly loss on Tuesday due to the coronavirus pandemic, though revenue quadrupled from a year ago and topped estimates with a strong domestic travel rebound.
U.S. leisure travel has nearly recovered to pre-pandemic levels as more people fly for vacation or to visit friends and family following a massive nationwide vaccination campaign.
Chicago-based United said it will continue ramping up flying in the third quarter and forecast its total unit revenue – comparing sales to flight capacity – for the period will be higher than the same quarter in 2019, a turning point for the airline.
The company said business and long-haul international travel, to which it is more exposed than rivals, accelerated faster than anticipated, and it expects a full recovery in demand by 2023.
United’s adjusted net loss narrowed to $1.26 billion, or $3.91 per share, in the quarter, from $2.6 billion, or $9.31 per share, a year ago. Analysts had estimated a loss of $3.94, according to IBES data from Refinitiv.
Excluding items, the company lost $434 million in the second quarter. United has said it expects to be profitable in the third and fourth quarter.
United’s second-quarter adjusted operating revenue rose to $5.47 billion from about $1.47 billion a year ago, above analysts’ average estimate of $5.35 billion.
U.S. airlines have played down concerns over the impact of a resurgence in COVID-19, spurred by the more contagious Delta variant of the coronavirus, which has become dominant in the United States and many other nations.
United’s quarterly revenue was just half of the roughly $10 billion it booked in the same quarter of 2019 before the pandemic jolted the travel industry.
Its shares slipped 0.5% to $46.08 in extended trading after the U.S. airline index had its largest daily percentage gain on Tuesday since November.
As demand returns, U.S. airlines – which benefited from $54 billion in federal COVID-19 aid for workers’ salaries – have rushed to restore their operations.
United last month unveiled its largest-ever aircraft order for 270 jets in a push to boost its domestic capacity by almost 30% and better compete for both premium and low-cost travel.
It has also announced a string of investments related to sustainability and innovation as airlines face renewed scrutiny over their environmental impact.
Rival Delta Air Lines last week reported a quarterly profit. American Airlines and Southwest Airlines are due to report on Thursday.
United will discuss the results with analysts and investors on Wednesday.
(Reporting by Tracy Rucinski; additional reporting by Rodrigo CamposEditing by Bill Berkrot)