Core Insights - American Airlines (AAL) reported second-quarter 2025 earnings of 95 cents per share, exceeding the Zacks Consensus Estimate of 79 cents, but down from $1.09 in the same quarter last year [1][10] - Operating revenues reached $14.4 billion, surpassing the Zacks Consensus Estimate of $14.29 billion and the previous year's figures [1][10] Revenue Breakdown - Passenger revenues, which constitute 91.1% of total revenues, decreased by 0.6% year-over-year to $13.1 billion, impacted by a slowdown in domestic leisure demand [2] - Cargo revenues increased by 8.2% to $211 million, exceeding the estimate of $204.4 million [2] - Other revenues rose by 13% to $1.06 billion, surpassing expectations of $973 million [2] Key Metrics - Total revenue per available seat mile decreased to 18.54 cents from 19.05 cents year-over-year [3] - Passenger revenue per available seat mile fell by 3.6% to 16.9 cents, slightly above the expectation of 16.89 cents [3] - Consolidated yield decreased by 1.5% to 19.96 cents, ahead of the estimate of 19.76 cents [3] Capacity and Traffic - Consolidated traffic increased by 0.9% year-over-year, while capacity expanded by 3.2% [4] - Consolidated load factor decreased by 1.9 points to 84.7%, lower than the expected 85.5% [4] Operating Costs - Total operating costs rose by 2.4% year-over-year to $13.26 billion, with salaries, wages, and benefits increasing by 10.9% to $4.4 billion due to a labor deal with pilots [5] - Aircraft fuel and tax expenses decreased by 13% to $2.67 billion, with the average fuel price per gallon dropping to $2.29 from $2.70 a year ago [5] Future Outlook - Management anticipates a 2-3% increase in capacity for Q3 2025 compared to Q3 2024, with total revenues expected to either decline by 2% or increase by up to 1% year-over-year [7] - AAL projects a loss per share of 10-60 cents for Q3, influenced by sluggish domestic travel demand [8] - For the full year 2025, AAL expects a loss of 20 cents or earnings of up to 80 cents per share, contingent on domestic demand [9]

We're pleased first off with the beat on the second quarter. Team did a wonderful job in really challenging conditions and so we're we're pleased with that. As we look out into the third quarter, it really is just getting the consumer, you know, back in the game. The uncertainty that we had seen, you know, certainly in the second quarter really still impacted July to a a great extent.We've got that on the books today. So, we know what July is shaping up to be. It's not a great month.and then compounded with ...

Market Overview - Pre-market futures are mixed but showing signs of weakening, following record high closes on the S&P 500, with profit-taking being a potential factor [1] - The tech-heavy Nasdaq is up by 42 points (+0.18%), while the Dow is down by 300 points (-0.67%) due to UnitedHealth's DOJ probe [2] Job Market Data - Initial Jobless Claims decreased to 217K, marking the lowest level in 14 weeks and the sixth consecutive week of decline [3] - Continuing Claims are reported at 1.955 million, slightly above the previous week's revised figure, indicating a stall just below 2 million [4] Q2 Earnings Reports - American Airlines (AAL) reported earnings of 95 cents per share, exceeding expectations by +20.25%, but shares fell -6% due to warnings of softer demand [5] - Honeywell (HON) surpassed earnings expectations with $2.75 per share, a +4.2% increase from the previous year, but shares are down -2.7% as the company plans to split into three segments [6] - Union Pacific (UNP) reported earnings of $3.03 per share, beating expectations by +4.84%, with revenues of $6.2 billion also exceeding forecasts, though shares are down -3% [7] Economic Indicators - S&P flash Services PMI for July is expected to rise to 53.2, while Manufacturing PMI is anticipated to dip to 52.7, both remaining above the growth threshold of 50 [8][9] - New Home Sales for June are projected at 645K units, an increase from 623K in the previous month, despite disappointing Existing Home Sales figures [10] Upcoming Earnings Reports - Intel and Deckers Outdoor are scheduled to report their Q2 earnings after the market closes today [11]

Financial Performance - For the quarter ended June 2025, American Airlines reported revenue of $14.39 billion, a 0.4% increase year-over-year, and EPS of $0.95, down from $1.09 in the same quarter last year [1] - The reported revenue exceeded the Zacks Consensus Estimate of $14.29 billion by 0.73%, while the EPS surprise was +20.25% compared to the consensus estimate of $0.79 [1] Key Metrics - Operating cost per ASM excluding net special items and fuel was 13.59 cents, slightly below the average estimate of 13.64 cents [4] - Passenger load factor was 84.7%, marginally below the average estimate of 84.8% [4] - Average aircraft fuel price was $2.29 per gallon, lower than the estimated $2.38 per gallon [4] Revenue Breakdown - Domestic passenger revenue was $9.16 billion, below the average estimate of $9.25 billion, representing a year-over-year decline of 2% [4] - Total international passenger revenue was $3.96 billion, exceeding the average estimate of $3.84 billion, with a year-over-year increase of 2.7% [4] - Revenue from cargo was $211 million, surpassing the estimated $201.19 million, reflecting an 8.2% increase year-over-year [4] Stock Performance - Shares of American Airlines have returned +14.7% over the past month, outperforming the Zacks S&P 500 composite's +5.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

American Airlines reissued full-year adjusted earnings guidance, setting a lower target than it had earlier in the year before tariffs and a domestic travel slowdown prompted major airlines to withdraw their outlooks https://t.co/56x3uWPV6Q ...

American Airlines CEO Robert Isom on Thursday said recent weather-related delays and cancellations have hit the carrier "harder than anyone," but that adding more air traffic controllers will eventually help address the issue. ...

About this content About Angela Harmantas Angela Harmantas is an Editor at Proactive. She has over 15 years of experience covering the equity markets in North America, with a particular focus on junior resource stocks. Angela has reported from numerous countries around the world, including Canada, the US, Australia, Brazil, Ghana, and South Africa for leading trade publications. Previously, she worked in investor relations and led the foreign direct investment program in Canada for the Swedish government ...

Financial Data and Key Metrics Changes - American Airlines reported an adjusted pretax profit of $869 million for Q2 2025, with earnings per share of $0.95, which is at the high end of the guidance provided earlier [7][21] - The company achieved record revenue of $14.4 billion in Q2 2025, reflecting a year-over-year increase of 0.4% [9][21] - The operating margin for Q2 was approximately 8%, with unit costs (excluding fuel and net special items) up 3.4% year-over-year [21][22] - Free cash flow for the quarter was $791 million, contributing to a total of $2.5 billion in the first half of the year [23][24] Business Line Data and Key Metrics Changes - Long-haul international PRASM increased by 5% for Atlantic routes and approximately 1% for Pacific routes, driven by strong demand in premium cabins [10] - Domestic unit revenue decreased by approximately 6% year-over-year, with expectations for improvement in the latter part of Q3 [11][26] - Managed business revenue grew by 10% year-over-year, outperforming broader industry growth [12] Market Data and Key Metrics Changes - The company experienced a 36% increase in disruptive operational events compared to the previous year, primarily due to significant storm activity [18][19] - Domestic capacity is expected to increase by approximately 5% during the July peak, but will slow to about 2% in August and decrease by 1% in September [26] Company Strategy and Development Direction - The company is focused on enhancing customer experience, operational excellence, and driving efficiencies throughout the airline [8][9] - American Airlines plans to expand its premium seating and improve its network, particularly in strategic hubs like Chicago, New York, and Philadelphia [14][15] - The company aims to restore its historical share of indirect channel revenue by the end of 2025, which is projected to represent $1.5 billion in revenue [62] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the recovery of domestic demand in the latter half of the year, despite challenges faced in the first half [28][29] - The company anticipates sequential improvement in revenue performance each month in Q3, with July expected to be the low point [26][42] - Management highlighted the resilience of the business and the team's ability to navigate a challenging operating environment [28][29] Other Important Information - The company raised $1 billion through a loyalty term loan financing, which was used to cash settle a convertible note [23] - American Airlines ended Q2 with approximately $38 billion in total debt and $29 billion in net debt, the lowest net debt levels since Q3 2015 [23] Q&A Session Summary Question: What percentage of American's flying loses money? - Management indicated that they do not base operations on competitors' perceptions and highlighted their strong hub and spoke network [34][35] Question: Can you provide insights on domestic performance from July to September? - Management noted that July has been challenging but expects about 65% of revenue on the books for Q3, with optimism for August and September [42][44] Question: What are the headwinds faced in the first half of the year? - Management acknowledged a tough first half but expects tailwinds from improving domestic demand and new credit card agreements with Citi [48][49] Question: How does American plan to improve customer experience? - Management will measure improvements through Net Promoter Scores and revenue performance, focusing on premium customer service enhancements [84][86] Question: What is the outlook for capacity and unit costs? - Management expects capacity to increase in Q4, with unit costs projected to be up around 3.5% as they continue to manage costs effectively [52][98]

Financial Data and Key Metrics Changes - The company reported an adjusted pretax profit of $869 million for Q2 2025, with earnings per share of $0.95, which is at the high end of the guidance provided earlier [6][20] - Total revenue for Q2 was $14.4 billion, reflecting a year-over-year increase of 0.4% [20] - The operating margin for Q2 was approximately 8%, with an EBITDAR margin of 14.2%, a decline of 1.5% year-over-year [20][21] - Free cash flow for Q2 was $791 million, contributing to a total of $2.5 billion in the first half of the year [22] Business Line Data and Key Metrics Changes - Long-haul international PRASM increased by 5% for Atlantic routes and approximately 1% for Pacific routes, while domestic unit revenue decreased by approximately 6% year-over-year [8][9] - Managed business revenue grew by 10% year-over-year, outperforming broader industry growth [10] - Active Advantage members increased by 7% year-to-date, with premium cabin unit revenue performing four points better than the main cabin [11] Market Data and Key Metrics Changes - Domestic unit revenue is expected to remain lower year-over-year in Q3, with July anticipated to be the low point [9][24] - The company expects capacity to increase by 2% to 3% year-over-year in Q3, with domestic capacity up approximately 5% during the July peak [24] Company Strategy and Development Direction - The company is focused on enhancing customer experience, operational excellence, and driving efficiencies [7][12] - Plans to expand premium seating and improve the customer experience through new lounge openings and enhanced in-flight services [13][15] - The company aims to restore its historical share of indirect channel revenue by the end of 2025, which could represent $1.5 billion in revenue [60] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term initiatives and the ability to recover from current challenges, including weather disruptions and operational issues [26][27] - The company anticipates sequential improvement in revenue performance as demand strengthens in the latter half of the year [24][41] Other Important Information - The company raised $1 billion through a loyalty term loan financing, reducing net debt to $29 billion, the lowest level since Q3 2015 [22] - The company is on track to take delivery of 50 new aircraft this year, with total CapEx expected to be between $3.5 billion and $4 billion [23] Q&A Session Summary Question: Percentage of American flights operating at a loss - Management stated that they do not base operations on competitors' perceptions and highlighted their strong hub and spoke network [32][34] Question: Domestic performance outlook for Q3 - Management indicated that July would be challenging, but they expect sequential improvement in August and September [40][41] Question: Capacity and unit costs outlook - Management confirmed that unit costs are expected to remain in line with previous guidance, with a focus on efficiency initiatives [49][50] Question: Indirect revenue share recovery - Management confirmed plans to restore indirect channel share by the end of 2025, which could lead to significant revenue increases [60] Question: Customer experience improvements - Management emphasized measuring improvements through Net Promoter Scores and revenue performance, with ongoing investments in premium services [83][86]

Core Insights - American Airlines reported quarterly earnings of $0.95 per share, exceeding the Zacks Consensus Estimate of $0.79 per share, but down from $1.09 per share a year ago, representing an earnings surprise of +20.25% [1] - The company achieved revenues of $14.39 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.73% and showing a slight increase from $14.33 billion year-over-year [2] - American Airlines has consistently surpassed consensus EPS and revenue estimates over the last four quarters [2] Earnings Outlook - The future performance of American Airlines' stock will largely depend on management's commentary during the earnings call and the sustainability of the stock's price movement based on recent earnings and future expectations [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.10 on revenues of $13.78 billion, and for the current fiscal year, it is $0.73 on revenues of $54.3 billion [7] Industry Context - The Transportation - Airline industry, to which American Airlines belongs, is currently ranked in the top 39% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]