United (UAL) Q2 2024 Earnings

Here is what the United newspaper reported: Second Quarter Compared to what Wall Street expected, based on median estimates compiled by LSEG:

• Earnings per share: $4.14 average vs. $3.93 expected
• Profit: $14.99 $1 billion vs. $15.06 billion expected

United earned $1.32 billion, or $3.96 a share, in the three months ended June 30, up from $1.08 billion, or $3.24 a share, a year earlier. Adjusted for non-recurring items, United reported second-quarter earnings of $4.14 a share, compared with the $3.93 a share analysts had expected.

Revenue rose to $14.99 billion, up 5.7% from a year ago, though it was slightly below estimates.

United reiterated its full-year forecast for adjusted earnings in the range of $9 to $11 per share.

United and Delta Air Lines, which also disappointed in the third quarter, remain prominent players in the airline industry. Most airlines are struggling to cope with increased domestic capacity in the United States, which has weighed on airfares, despite record demand.

Both airlines have added international flights, which were in high demand after the pandemic, and premium offerings, such as larger lounges and more spacious seats, to take advantage of travelers willing to pay more for a ticket.

United said Wednesday that its premium ticket revenue grew more than 8% compared with a year ago, while sales of more restrictive basic economy tickets rose 38%, serving both ends of the market.

United expanded its domestic flights by more than 5% in the second quarter compared with a year ago, and the unit’s revenue fell more than 1% compared with a year ago. Revenue on flights to and from Europe, a smaller segment of United’s sales, rose more than 5% compared with the second quarter of 2023.

United CEO Scott Kirby said airlines have cut their schedules and there will be a tipping point for adjusting the offer in mid-August.

“Looking ahead, we see many airlines beginning to eliminate loss-making capacity, and we expect to deliver leading unit revenue performance among our largest peers in the second half of the third quarter,” he said.

On Tuesday, Spirit Airlines cut its second-quarter outlook, citing weaker-than-expected revenue from fees such as seats or baggage. Southwest Airlines and American Airlines, which will report results on July 25, also cut their second-quarter estimates.