American Airlines Expects Domestic Gains, But Hedges On Outlook

Core Insights - American Airlines provided negative guidance for the current quarter and unusually wide full-year guidance, indicating challenges in maintaining competitive pre-tax margins [1][5]. Financial Performance - For the second quarter, American Airlines reported revenue of $14.4 billion, a 0.4% increase year-over-year. Net income was $628 million, or 91 cents per share, down from $717 million, or $1.01 per share in the same quarter last year [4]. - The company expects a current quarter loss per share between 10 cents and 60 cents, and for the full year, adjusted earnings are projected to range from a loss of 20 cents to a gain of 80 cents per share, with a midpoint of 30 cents [2][3]. Market Position - American Airlines' pre-tax margin was reported at 5.8%, significantly lower than competitors Delta (11.6%) and United (11%) [5]. - The airline noted strong demand in premium cabin travel for international routes, with Atlantic passenger unit revenue increasing by 5%. However, domestic PRASM (Passenger Revenue per Available Seat Mile) declined by 6.4% [6]. Future Outlook - CEO Robert Isom expressed optimism about the return of domestic travelers and indicated that high demand trends are expected to continue, despite challenges faced in July due to weather [2].