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United Airlines results top estimates despite $200 million hit from Boeing grounding

In Business
April 17, 2024

A United Airlines Boeing 737 Max 9 aircraft lands at San Francisco International Airport.

Justin Sullivan | Getty Images

United Airlines on Tuesday reported strong travel demand that drove it to a narrower loss than expected in the first quarter despite a $200 million hit from the temporary grounding of the Boeing 737 Max 9 in January.

The Federal Aviation Administration temporarily grounded those jets after a door plug blew out minutes into an Alaska Airlines flight, sparking a new safety crisis for Boeing and slowing deliveries of its planes to customers including United, Southwest and others.

Here’s what United reported in the first quarter compared with what Wall Street expected, based on average estimates compiled by LSEG:

  • Loss per share: 15 cents adjusted vs. a loss of 57 cents expected
  • Revenue: $12.54 billion vs. $12.45 billion expected

The airline posted a net loss of $124 million in the first quarter. Revenue rose nearly 10% in the first quarter compared with the year-earlier period to $12.54 billion, with capacity up more than 9% on the year.

United said it plans to lease 35 Airbus A321neos in 2026 and 2027, turning to Boeing’s rival for new planes as the U.S. manufacturer faces caps on its production and increased federal scrutiny. In January, United said it was taking Boeing’s not-yet-certified Max 10 out of its fleet plan. The airline said it has converted some Max 10 planes for Max 9s.

United expects to receive just 61 new narrow-body planes this year, down from 101 it said it had expected at the beginning of the year.

The airline expects to post earnings of between $3.75 and $4.25 in the second quarter, ahead of analysts’ estimates of about $3.76 a share. Airlines make the bulk of their profits in the second and third quarters, during peak travel season.

The carrier also reiterated its full-year earnings forecast of between $9 and $11 a share.

United executives will hold a call with analysts at 10:30 a.m. ET on Wednesday morning.

This is breaking news. Check back for updates.

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