United Airlines Flies Higher After Smashing Profit Forecasts


United Airlines parent United Continental Holdings Inc  topped estimates for first quarter profit, but missed on revenue. The carrier said it is still confident it will hit its fiscal 2019 target for adjusted earnings of between $10 and $12 per share, as well as adjusted earnings of between $11 and $13 next year.

United is currently not flying the troubled Boeing 737 MAX jet after the model was grounded worldwide last month in the wake of two deadly accidents that killed a total of 346 people. Boeing is testing software upgrade that is aimed at solving issues that brought down two new MAX jets operated by Indonesia Lion Air and Ethiopian Airlines.

Chicago-based United Airlines said revenue per available seat mile grew 1.1% during the quarter. Total operating revenue, meanwhile, jumped 7.1% to $8.73 billion during the quarter.

United Continental Holdings Inc. shares jumped 0.77% during the regular trading session to close at $85.17. The stock, which is up 27% in the last 12 months, gained $3.08, or 3.5%, to $88.25 in after-hours trading after the earnings report.

UAL Earnings & Outlook

United Airlines said it had GAAP earnings of $292 million, or $1.09 per share in the three months to March 31, 2019. The company posted GAAP earnings of $145 million, or $0.51 per share in the same period last year.

Adjusted earnings came to $1.15 per share, up 135% on a year-over-year basis. Analysts expected the company to post adjusted earnings of $0.95 per share, based on figures compiled by Refinitiv.

Total revenue came to $9.59 billion, an increase of 6.2% from $9.03 billion in the earlier-year period. Analysts polled by Refinitiv had forecast revenue of $9.61 billion during the quarter.

United Airlines CEO Comments

“We delivered another strong financial quarter in which we made important progress on our customer investments while making strategic decisions to manage our costs and producing pre-tax margin growth that we expect will lead our peers,” said Oscar Munoz, chief executive officer of United Airlines.

“That’s why we are more confident than ever that we’ll reach our long-term adjusted EPS targets we unveiled last year. I want to thank all 93,000 of our employees for their incredible work as we overcame some unique challenges and refocused our efforts in 2019 toward elevating the United experience for our customers,” Munoz concluded.

United Continental Holdings Inc. Profile

United Airlines operates more than 4,500 flights a day to five continents. United’s hubs include San Francisco, Chicago, Houston, Denver, Los Angeles, New York/Newark, and Washington, D.C. United operates more than 744 mainline aircraft.

The airline is a member of the Star Alliance, which provides service to 192 countries via member airlines. In 2017, the carrier had $37.7 billion in revenue, of which $32.4 billion was passenger revenue.