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United Airlines reported its highest revenue in the second quarter and had its first profitable quarter since the start of the Covid-19 pandemic, the carrier said on Wednesday.
The Chicago-based airline, the second largest in the US, reported net income of $329 million on operating income of $12.1 billion. Revenues were up 6% compared to the March-June 2019 quarter, while flying 15% fewer seats.
Earnings per share came in at $1.43, below analysts’ estimates of $1.95 per share, according to a Refinitiv poll.
Summer air travel was thrown into chaos in May and June as airline operations struggled to scale up to meet the surge in pent-up demand created by the Covid-19 pandemic. More than 34,000 United flights to, from or within the U.S. were canceled or delayed, equivalent to a quarter of the entire schedule for those two months, according to flight tracker FlightAware.
“It’s good to be back to profitability, but we have to face three risks that could grow over the next six to 18 months,” said CEO Scott Kirby, referring to “operational challenges across the industry that are limiting the capacity of system, record fuel prices and the growing possibility of a global recession’.
Ed Bastian, chief executive of rival Delta Air Lines, told the Financial Times last week that he was not worried about the impact of a potential recession on the airline.
United spent roughly $4.18 per gallon of fuel, consuming 912 million gallons in the second quarter. The airline expects fuel prices to drop in the third quarter to $3.81 a gallon.
The carrier also forecast third-quarter revenue to rise 11% from the same period in 2019, when it totaled $11.4 billion. United also confirmed their expectations for a winning full year.
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