American Airlines shares tumble 10% as outlook falls short

American Airlines‘ first-quarter earnings outlook on Thursday fell short of analysts’ estimates, sending shares down roughly 10%.

The carrier forecast an adjusted loss per share of 20 cents to 40 cents for the first three months of 2025 based on current demand trends and fuel-price forecast, a wider loss than the 4 cents analysts were expecting, according to LSEG.

The airline said it expects unit costs, excluding fuel, to rise in the low-single digit percentage points over the first quarter of 2024 driven by lower capacity, which it expects to fall as much as 2% over last year; a higher mix of smaller; regional-jet flying and new labor agreements it finalized last year.

The earnings outlook contrasts with sunnier forecasts from rivals United and Delta earlier this month, though American’s full-year earnings forecast of between $1.70 and $2.70, with analysts’ estimates.

American has spent much of the last year reversing a business-travel sales strategy that backfired last year. However, it also sealed a new credit card deal with its partner Citi. Compensation from its existing deals with Citi and Barclays rose 17% from 2023 to $6.1 billion last year, American said.

“As we look ahead to this year, American remains well-positioned because of the strength of our network, loyalty and co-branded credit card programs, fleet and operational reliability, and the tremendous work of our team,” CEO Robert Isom said in a news release.

Here is how American performed in the fourth quarter compared with Wall Street estimates compiled by LSEG:

• Earnings per share: 86 cents adjusted vs. 64 cents
• Revenue: $13.66 billion vs. $13.40 billion expected

American’s fourth-quarter profit rose to $590 million from $19 million on sales that were up 4.6% on the year to $13.66 billion. Both domestic and international revenue rose, led by a surge in trans-Pacific revenue.