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Led by improved demand for air travel, efficiency measures, and a collaboration with United Airlines (UAL), JetBlue Airways (NASDAQ:JBLU) reported a much smaller-than-expected loss for the second quarter, driving shares higher in Tuesday’s premarket trading.
“Despite facing an uncertain economic backdrop, we met or exceeded our financial targets, delivering a modest operating profit for the quarter. The momentum we have built since launching our multi-year strategy last summer reinforces our conviction that JetForward is the right plan to return JetBlue to sustained profitability,” said CEO Joanna Geraghty.
The carrier posted an adjusted loss of $0.16 per share for the second quarter, compared to a profit of $0.08 per share a year earlier, but still topped Wall Street’s expectations for a larger loss of $0.33 per share. Revenue was down 1.2%, however, to $2.4B, but still beat expectations by $110M.
The company’s other metrics were mixed as available seat mile (ASM) was up 1.5% while costs per available seat mile (CASM) excluding fuel rose 6%. Revenue achieved per passenger mile was down 4% from last year. Load factor declined by 210 basis points to 81.9% year-over-year.
For the current quarter, JetBlue (NASDAQ:JBLU) expects ASM to be down 1% to up 2%, while revenue per available seat mile (RASM) is forecasted to decline by 2% to 6%. CASM ex-fuel forecasted to increase 4% to 6%.
For the year, ASM is expected to be down 0.5% to down 2.5% and CASM ex-fuel up 5% to up 7%. However, the company now expects its Blue Sky collaboration with United (UAL) to contribute $50M more in incremental EBIT than initially expected. As a result, JetBlue (NASDAQ:JBLU) is recalibrating the total program range to $850M to $950M in EBIT benefit by the end of 2027 from $800M to $900M, previously.
Shares are up more than 5% in early trading, giving a modest boost to competitors American Airlines (AAL), Delta Air Lines (DAL), and United Airlines (UAL).