Jan 12 (Reuters) – American Airlines Group (AAL.O) on Thursday expected fourth-quarter earnings to rise on strong demand for travel during the major holiday season, sending its shares up 5 in pre-market trading. increased by more than 10%.
The positive outlook comes at a time when a deteriorating economic outlook combined with high inflation is raising concerns about consumer demand.
Shares of other airlines, including Delta Air Lines (DAL.N), Southwest Airlines (LUV.N) and United Airlines Holdings (UAL.O), also rose 1% to 3% before the market.
The fourth quarter was a difficult quarter for several U.S. airlines as an industry-wide pilot shortage made it difficult to build capacity and take advantage of surging travel demand.
During the fourth quarter, American Airlines capacity declined 6.1% versus the fourth quarter of 2019, nearing the midpoint of its previous guidance of a 5% to 7% decline.
American Airlines expects to report fourth-quarter adjusted earnings per diluted share of between $1.12 and $1.17, compared with previous guidance of $0.50 to $0.70. Analysts had expected a profit of 60 cents, according to Refinitiv data.
The company also expects revenue to grow 16% to 17% starting in the fourth quarter of 2019.
Ex-fuel costs are expected to increase by approximately 10% in the fourth quarter from the upper end of previous forecasts of 8% and 10%.
Reported in Bangalore by Kannaki Deka and Nathan Gomes.Edited by Shinjini Ganguly
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