Source: Zhitong Finance

$American Airlines (AAL.US)$The adjusted profit guidance for the second quarter was lowered and fell short of Wall Street expectations. Affected by this news, American Airlines shares fell more than 14% on Wednesday as of press release.

American Airlines currently expects second-quarter adjusted earnings of $1.00-1.15 per share, compared to the previous forecast of $1.15-1.45, compared to the market forecast of $1.27. The company expects the adjusted operating margin for the second quarter to be around 8.5% to 10.5%, compared to the previous forecast of 9.5% to 11.5%.

American Airlines also expects total revenue per usable seat mile (TRASM) for the second quarter to drop by about 5%-6% year over year; the cost per usable seat mile (CASM) — excluding fuel and net special items — is expected to remain flat to a 1% year-on-year increase, which was previously expected to increase by 1% to 3% year over year; and the average fuel price (including tax) is estimated to be around $2.70-2.80 per gallon, previously estimated at $2.75 to $2.95 per gallon.

Earlier, United Airlines (UAL.US) also lowered its adjusted profit guidelines for the second quarter of 2024. The adjusted diluted earnings per share for the second quarter of 2024 are expected to be between $3.75 and $4.25, and the median earnings per share range is lower than the market's consensus estimate of $4.02.

edit/lambor