Home Stock CEO Parker explains why American Airlines remained in loss in Q3

CEO Parker explains why American Airlines remained in loss in Q3


American Airlines Group Inc (NASDAQ: AAL) says it lost less-than-expected money in the fiscal third quarter on revenue that nearly tripled on a year-over-year basis. Shares are up about 1.0% in premarket trading.

CEO Parker’s remarks on CNBC’s ‘Squawk Box’

On CNBC’s “Squawk Box”, CEO Doug Parker said business travel was strong at the start of the quarter, but later the Delta variant curbed it again to push us back into loss.

We had a profitable July when revenue from business travel was at 64% of 2019 levels. Then the Delta variant hit and pushed it back below 50% of pre-pandemic levels in September, resulting in a quarterly loss, which was still the smallest since the start of the pandemic.”

Parker said American Airlines’ return to profitability is tied with the demand for business travel and refrained from giving a specific guidance on how long could it take to hit profitability again.

Q3 financial performance

American Airlines reported $169 million in net income that translates to 25 cents per share. In the same quarter last year, it had posted a massive $2.40 billion in loss or $4.71 per share. Adjusted for one-time items, the air carrier lost 99 cents per share in the recent quarter.

The airline generated $8.97 billion in revenue that represents a 182.7% increase from last year. According to FactSet, experts had forecast $1.04 of adjusted per-share loss on $8.92 billion in revenue.

Future outlook and other notable figures

Other notable figures included a 213.3% increase in passenger revenue and roughly $18 billion in available liquidity. Load factor climbed from 58.9% to 78.7% – still lower than 80.9% expected.

American Airlines expects its Q4 revenue to come in about 20% down from the 2019 equivalent, as per the earnings press release. Analysts, in comparison, are calling for a 17.8% lower revenue this quarter.

The post CEO Parker explains why American Airlines remained in loss in Q3 appeared first on Invezz.

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