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American Airlines Gains as More Flights Return it to Profit

Published 10/21/2021, 07:56 AM
Updated 10/21/2021, 08:03 AM
© Reuters.
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By Dhirendra Tripathi

Investing.com – American Airlines stock (NASDAQ:AAL) traded 1.2% higher as the company returned to profits in the third quarter and said it will add capacity to cater to rising demand.

Third-quarter profit was $169 million compared to a loss of $2.39 billion in July-September last year. Excluding items, the company posted a third-quarter net loss of $641 million.

American follows Tuesday's reporting of better numbers by United Airlines (NASDAQ:UAL). Adjusted loss at the carrier, which has a larger international presence, narrowed to $329 million from $2.37 billion in the September quarter of last year.

As the holiday season gets underway and countries lift restrictions – the U.S. opened its borders to vaccinated foreign travelers on November 8 – airlines like American are adding capacity, ordering planes, hiring more employees and sewing up codeshare pacts for international passengers.

The airline said it expects more than 6,000 peak-day departures in the current quarter. Even so, capacity will still be down versus pre-pandemic levels at the end of the year.

The company said it expects its fourth-quarter capacity to be down a maximum 13% compared to the fourth quarter of 2019. It expects fourth-quarter revenue to be down around 20%.

The airline closed the quarter with access to cash and cash equivalent of $18 billion. Total operating revenue jumped 183% to $8.97 billion.

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