AZUL Posts Wider-Than-Expected Q1 Loss, Sees Y/Y Revenue Rise

Azul S.A. Performance Summary - Azul S.A. reported a loss of 57 cents per share in Q1 2024, which is wider than the Zacks Consensus Estimate of a loss of 53 cents, compared to a loss of 99 cents in Q1 2023 [1] - Total revenues reached $945 million, falling short of the Zacks Consensus Estimate of $968.2 million, but showing year-over-year growth due to strong demand and ancillary revenues [1] - Passenger revenues, which account for 93.1% of total revenues, increased by 4.5% year over year, supported by a 2.6% rise in total capacity [1] Traffic and Capacity Metrics - Consolidated traffic, measured in revenue passenger kilometers (RPKs), increased by 1.7%, with domestic traffic up 4.8% and international traffic down 9.6% year over year [2] - Consolidated available seat kilometers (ASK) rose by 2.6% from Q1 2023, with domestic capacity increasing by 6% and international capacity decreasing by 10.3% [2] - The load factor fell by 0.7 percentage points to 78.9% as traffic growth did not keep pace with capacity expansion [2] Revenue and Cost Analysis - Total revenues per ASK (RASK) increased by 1.8%, while passenger revenues per ASK (PRASK) rose by 1.9% year over year [2] - Cost per ASK (CASK) decreased by 5.9% from the previous year, primarily due to a 19.1% reduction in fuel prices, although CASK excluding fuel grew by 5.1% [2] Average Fare and Liquidity - The average fare increased by 2.3% compared to Q1 2023 [3] - Azul ended Q1 2024 with total liquidity of R$5.98 billion, while gross debt rose by 12.8% year over year [3] - For 2024, Azul anticipates an EBITDA of approximately R$6.5 billion [3] Industry Comparisons - Delta Air Lines reported earnings of 45 cents per share, exceeding the Zacks Consensus Estimate of 36 cents, with revenues of $13.75 billion, up 7.75% year over year [4][5] - United Airlines reported a loss of 15 cents per share, which was narrower than the expected loss of 53 cents, with total operating revenues of $12,539 million, up 9.7% year over year [4][5] - J.B. Hunt Transport Services reported earnings of $1.22 per share, missing estimates and declining 35.5% year over year, with total operating revenues of $2,944 million, down 8.8% year over year [6]