A Southwest Airlines jet leaves Midway Airport on in Chicago, Illinois.
Scott Olson | Getty Images
Both carriers have noted an improvement in travel bookings and plan to increase flying during the peak spring and summer months as more people are vaccinated against Covid-19 and tourist attractions reopen.
American Airlines posted a $1.25 billion net loss. The Fort Worth, Texas-based carrier, like its large-carrier rivals Delta and United, has been forced to do without much of the business and international travel revenue they long relied on. American’s revenue came in at just over $4 billion, down nearly 53% from the more than $8.5 billion it posted a year ago, and below analysts’ expectations.
“The pandemic is far from over. We have to continue to fight like never before and ensure that when the green flag drops, American is out in front,” American’s CEO Doug Parker and President Robert Isom said in a note to employees. “But as our world makes daily strides in COVID-19 vaccination efforts, customers are returning to travel and there is no doubt the pace of the recovery is accelerating.”
Adjusting for one-time items, American had a per-share loss of $4.32, a penny more than analysts’ estimates.
Better demand is helping both carriers trim their cash burn. American had an average daily cash burn of $27 million in the first quarter, which fell to $4 million in March.
American’s shares were up 2% premarket.
Southwest, meanwhile, said it expects to break even “or better” by June.
The Dallas-based airline posted first-quarter net income of $116 million, compared with a $94 million loss a year ago. Its first-quarter profit was the result of more than $1 billion in federal aid that offset its labor costs.
Southwest’s shares were up 1% in premarket trading, after trading lower before it reported results.
Southwest said it’s beefing up its schedule and that it will fly only slightly less this June than the same month of 2019.
Southwest’s revenue fell to $2.05 billion, down more than 51% from last year and slightly below the $2.07 billion Wall Street analysts were expecting.