Core Insights - American Airlines reported a narrower-than-expected loss, indicating improved financial performance compared to previous forecasts [1] - The company exceeded revenue expectations, suggesting strong demand and effective cost management [1] Financial Performance - The reported loss was less than analysts had anticipated, reflecting a positive trend in the airline's recovery [1] - Revenue figures surpassed expectations, highlighting the airline's ability to capitalize on market conditions [1] Market Reaction - Following the earnings report, American Airlines' stock experienced an increase, signaling investor confidence in the company's future prospects [1]

American Airlines (NASDAQ:AAL) flew higher in early trading on Thursday after besting the consensus estimates of analysts with its third-quarter earnings report. Revenue was up 0.3% year-over-year to $13.96 billion for the quarter, nipping the consensus mark by $60 million. ...

Core Insights - American Airlines reported a smaller-than-expected loss for Q3, leading to a positive stock reaction as the outlook for the remainder of the year exceeded Wall Street forecasts [1][2] Financial Performance - The company expects to earn between 45 cents and 75 cents per share in Q4, surpassing the analyst expectation of 31 cents per share [2] - Full-year earnings guidance has been raised to between 65 cents and 95 cents per share, significantly above the projected 43 cents per share by Wall Street [2] - In Q3, American Airlines reported an adjusted loss per share of 17 cents, compared to an expected loss of 28 cents, and revenue of $13.69 billion, exceeding the expected $13.63 billion [4] Industry Context - An oversupply of domestic flights has led airlines to adjust their growth plans to avoid unprofitable operations [3] - The airline industry is facing challenges in profitability during the summer months, attributed to earlier school reopenings and a shift in traveler preferences towards larger trips later in the year [3]

Financial Performance - Total operating revenues for Q3 2025 were $13,691 million, a slight increase from $13,647 million in Q3 2024, while year-to-date revenues reached $40,634 million compared to $40,551 million in the same period last year[19]. - Passenger revenue for Q3 2025 was $12,471 million, down 0.4% from $12,523 million in Q3 2024, with year-to-date passenger revenue at $36,985 million, a decrease of 0.5% from $37,184 million[19]. - Operating income for Q3 2025 was $151 million, compared to $89 million in Q3 2024, while year-to-date operating income decreased to $1,015 million from $1,480 million[19]. - Net loss for Q3 2025 was $114 million, an improvement from a net loss of $149 million in Q3 2024, with year-to-date net income at $12 million compared to $256 million in the same period last year[21]. - The company reported a total comprehensive loss of $99 million for Q3 2025, an improvement from a loss of $126 million in Q3 2024[21]. - For the three months ended September 30, 2025, the company recorded a net loss of $114 million, while for the nine months ended September 30, 2025, the net income was $599 million[28]. - Net income for Q3 2025 was $10 million, recovering from a net loss of $41 million in Q3 2024, while net income for the nine months ended September 30, 2025, was $344 million, down from $536 million in the same period of 2024[82]. - Operating income for Q3 2025 was $167 million, compared to $90 million in Q3 2024, with a nine-month operating income of $1,042 million, down from $1,496 million in the same period of 2024[80]. Cash Flow and Liquidity - Cash and restricted cash at the end of Q3 2025 totaled $938 million, slightly up from $933 million at the end of Q3 2024[26]. - Net cash provided by operating activities for the nine months ended September 30, 2025, was $3,373 million, down from $3,585 million in the same period of 2024[26]. - As of September 30, 2025, total available liquidity was $10.3 billion, consisting of $6.9 billion in unrestricted cash and short-term investments[151]. - The maximum availability under revolving credit and other facilities as of September 30, 2025, was $3.4 billion[49]. Debt and Liabilities - Current liabilities increased to $24,638 million as of September 30, 2025, compared to $24,295 million at the end of 2024[24]. - Long-term debt and finance leases, net of current maturities, remained stable at $25,113 million as of September 30, 2025, compared to $25,154 million at the end of 2024[24]. - Total long-term debt as of September 30, 2025, was $28.365 billion, a decrease from $30.118 billion at the end of 2024[48]. - The company replaced approximately $2.3 billion in outstanding term loans with new loans under the AAdvantage Term Loan Facilities, with a reduced quarterly principal amortization of approximately $6 million starting July 2025[51]. - An additional $1.0 billion of incremental term loans was incurred under the 2025 AAdvantage Term Loan Facility, with a quarterly principal amortization of approximately $3 million beginning July 2025[52]. - The company prepaid $487 million of equipment notes and $308 million of senior secured notes during the first nine months of 2025[56]. Assets and Investments - Total assets as of September 30, 2025, were $62,141 million, an increase from $61,783 million at the end of 2024[24]. - The company’s equity investments totaled $563 million as of September 30, 2025, reflecting an increase from $515 million at the end of 2024[67]. - The company holds a 25% equity interest in Republic Airways Holdings Inc., the parent company of Republic[73]. Revenue Breakdown - Cargo revenue increased by $10 million, or 5.0%, in Q3 2025, primarily due to a 4.3% increase in cargo yield[143]. - Other operating revenue increased by $86 million, or 9.4%, in Q3 2025, driven primarily by higher revenue from the loyalty program[144]. - Loyalty revenue from travel for the three months ended September 30, 2025, was $1,069 million, compared to $984 million in 2024, representing an increase of about 8.6%[99]. - The loyalty program liability increased to $10.514 billion as of September 30, 2025, from $10.054 billion at the end of 2024, reflecting a deferral of revenue of $3.362 billion and recognition of revenue of $(2.902) billion[46]. Operating Expenses - Total operating expenses for Q3 2025 were $13,521 million, slightly lower than $13,555 million in Q3 2024[80]. - Salaries, wages, and benefits increased by $363 million, or 8.9%, in Q3 2025, due to contractual wage rate increases and higher benefit costs[165]. - Aircraft fuel and related taxes were $2.8 billion in Q3 2025, a decrease of $107 million, or 3.7%, compared to Q3 2024[146]. - Total operating cost per available seat mile (CASM) was 17.49 cents in Q3 2025, a decrease of 2.4% from 17.92 cents in Q3 2024[149]. Taxation - The company recorded an income tax benefit of $28 million and an income tax provision of $36 million for the three and nine months ended September 30, 2025, primarily due to the utilization of NOLs[60]. - American Airlines recorded an income tax provision of $128 million in the first nine months of 2025[215]. Pension and Benefits - For the three months ended September 30, 2025, the net periodic benefit income for pension benefits was $(30) million, compared to $(39) million in 2024[68]. - The service cost for pension benefits for the nine months ended September 30, 2025, was $2 million, compared to $1 million in 2024[68]. - American Airlines made required contributions of $224 million to its defined benefit pension plans[69]. Special Items - Special items for the three months ended September 30, 2025, included labor contract expenses of $31 million, while the previous year reported $516 million for the same period[98].

Exhibit 99.1 Corporate Communications mediarelations@aa.com Investor Relations investor.relations@aa.com FOR RELEASE: Thursday, Oct. 23, 2025 American produced third-quarter revenue of $13.7 billion. Year-over-year unit revenues improved sequentially throughout the quarter with September producing positive unit revenue growth. Premium unit revenue growth year over year continues to outperform the main cabin. The company remains focused on executing its strategic priorities and delivering on its revenue pote ...

Core Viewpoint - American Airlines Group Inc. reported its third-quarter 2025 financial results, highlighting strong revenue performance and a focus on cost management and balance sheet strengthening, with optimism for future growth in 2026 and beyond [1]. Revenue Performance - The company generated third-quarter revenue of $13.7 billion, with year-over-year unit revenues improving throughout the quarter, particularly in September, which saw positive unit revenue growth [2]. - Premium unit revenue growth continues to outperform main cabin revenue growth [2]. Strategic Priorities - American Airlines aims to fully restore its share of indirect revenue impacted by previous sales strategies by the end of the year and plans to expand its share beyond historical levels, which is expected to create significant value [3]. Loyalty Program and Credit Card Performance - The AAdvantage® loyalty program saw a 7% year-over-year increase in active accounts, and spending on co-branded credit cards rose by 9% year-over-year [4]. - The company is preparing for an exclusive partnership with Citi starting in January 2026 [4]. Customer Experience Enhancements - American Airlines is enhancing the travel experience by opening new Flagship® lounges and expanding Admirals Club® lounges, alongside improvements in onboard services and partnerships with Lavazza and Champagne Bollinger [5]. Operational Performance - The airline maintained resilient operations despite challenges from significant weather events and FAA technology outages, thanks to investments in technology and operating systems [6]. Balance Sheet and Liquidity - As of the end of the third quarter, the company reported total debt of $36.8 billion and net debt of $29.9 billion, with a goal to reduce total debt to below $35 billion by the end of 2027 [7]. - The company had $10.3 billion in total available liquidity, including cash, short-term investments, and undrawn credit facilities [7]. Financial Guidance - For the fourth quarter of 2025, adjusted earnings per diluted share are expected to be between $0.45 and $0.75, with full-year adjusted EPS projected between $0.65 and $0.95 [8][9]. - The company anticipates full-year free cash flow exceeding $1 billion [8].

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Market Overview - U.S. stock futures experienced volatility following declines on Wednesday, with major benchmark indices showing lower futures [1] - Disappointing earnings guidance and escalating U.S.-China trade tensions have negatively impacted investor confidence [1] - The Trump administration is contemplating new export restrictions to China, targeting products made with U.S.-developed software [1] Treasury Yields and Federal Reserve Outlook - The 10-year Treasury bond yielded 3.98%, while the two-year bond was at 3.46% [2] - Market projections indicate a 96.7% likelihood of the Federal Reserve cutting interest rates in its October meeting [2] Stock Performance Highlights - Tesla Inc. (NASDAQ:TSLA) fell 3.04% in premarket trading despite reporting better-than-expected revenue for Q3, with earnings missing estimates [6] - International Business Machines Corp. (NYSE:IBM) dropped 7.14% despite better-than-expected financial results, but raised its full-year 2025 revenue growth guidance to "more than" 5% [6] - American Airlines Group Inc. (NASDAQ:AAL) rose 1.41% as analysts anticipate a quarterly loss of 28 cents per share on revenue of $13.63 billion [6] - Medpace Holdings Inc. (NASDAQ:MEDP) surged 18.52% after reporting Q3 revenue of $659.9 million and earnings of $3.86 per share, both exceeding analyst estimates [12] Economic Data and Analyst Insights - Initial jobless claims data will be delayed due to an impending shutdown, with existing home sales for September expected to be released at 10:00 a.m. ET [13] - Mike Wilson, Morgan Stanley's CIO, argues that the Federal Reserve is "behind the curve" and should implement significant rate cuts to align with market conditions [9][10] Commodities and Global Markets - Crude oil futures increased by 5.220% to approximately $61.54 per barrel [14] - Gold Spot prices rose 0.38% to around $4,114.22 per ounce, while Bitcoin traded 1.16% higher at $109,323.15 per coin [14]

Market Overview - U.S. stock futures experienced volatility following declines on Wednesday, with major benchmark indices showing lower futures [1] - Disappointing earnings guidance and escalating U.S.-China trade tensions have negatively impacted investor confidence [1] - The Trump administration is contemplating new export restrictions to China, targeting products made with U.S.-developed software [1] Economic Indicators - The 10-year Treasury bond yielded 3.98%, while the two-year bond was at 3.46% [2] - Market expectations indicate a 96.7% likelihood of the Federal Reserve cutting interest rates in its October meeting [2] Stock Performance - Tesla Inc. (NASDAQ:TSLA) fell 3.04% in premarket trading despite reporting better-than-expected revenue for Q3, with earnings missing estimates [6] - International Business Machines Corp. (NYSE:IBM) dropped 7.14% despite better-than-expected Q3 results, but raised its full-year 2025 revenue growth guidance to "more than" 5% [6] - American Airlines Group Inc. (NASDAQ:AAL) rose 1.41% as analysts anticipate a quarterly loss of 28 cents per share on revenue of $13.63 billion [6] - Medpace Holdings Inc. (NASDAQ:MEDP) surged 18.52% after reporting Q3 revenue of $659.9 million and earnings of $3.86 per share, both exceeding analyst estimates [12] - Ford Motor Co. (NYSE:F) shares remained unchanged ahead of its earnings report, with analysts expecting earnings of 36 cents per share on revenue of $43.08 billion [12] Sector Performance - Most sectors on the S&P 500 closed negatively, with communication services, industrials, and consumer discretionary stocks experiencing the largest losses [7] Analyst Insights - Mike Wilson, Morgan Stanley's CIO, argues that the Federal Reserve is "behind the curve" and needs to implement "meaningful" rate cuts, suggesting a need for cuts of 150 basis points or more [9][10] - Wilson believes the economy has transitioned into an "early cycle new recovery," dismissing recent market volatility as part of a new economic cycle [11]

Market Overview - U.S. stocks experienced a decline, with the Dow Jones index dropping over 300 points due to disappointing earnings guidance and rising U.S.-China trade tensions [1][4] - The Dow Jones closed lower by approximately 334 points at 46,590.41, while the S&P 500 fell 0.53% to 6,699.40, and the Nasdaq Composite decreased by 0.93% to 22,740.40 [4] Company Performance - Netflix Inc. was the largest laggard in the S&P 500, falling more than 10% after reporting a $619 million loss related to a tax dispute in Brazil, overshadowing its strong content performance [2] - AT&T Inc. shares declined around 2% following the announcement of its fiscal third-quarter financial results [2] Economic Indicators - The volume of mortgage applications decreased by 0.3% from the previous week for the week ending October 17 [3] - Most sectors in the S&P 500 closed negatively, with communication services, industrials, and consumer discretionary stocks experiencing the largest losses, while energy and consumer staples sectors closed higher [3] Investor Sentiment - The CNN Money Fear and Greed index indicated an increase in overall fear, remaining in the "Fear" zone with a current reading of 26.5, down from a prior reading of 29 [5]