American Airlines Q3 profit beats street, shares fall
American Airlines reported a better-than-expected quarterly profit on Thursday on higher demand for business and leisure travel, but shares fell nearly 5% on factors including higher operating expenses. CEO Doug Parker said on an earnings call that the airline would work with a US civil rights group that called on Tuesday for black travellers to avoid American because of what the group called a pattern of racially biased incidents. “Discrimination, exclusion and unconscious biases are enormous problems that no one has mastered,” Parker said. For the current quarter, American said it expects revenue per available seat mile, a closely watched metric that compares sales to flight capacity, to rise between 2.5 and 4.5% from a year ago. American’s solid Q3 report came even as operations were hit by severe hurricanes. Still, shares closed down 4.72% at $48.61. The airline’s Q3 operating expenses swelled by 5.3% to $9.6b, a sore spot for investors. Increasing costs for fuel and labor have caused expenses to spike across the industry. Earlier this year, American said it offered an unexpected mid-contract pay increase to its pilots and flight attendants, which will cost an additional $230m for 2017 and $350m for 2018 and 2019. The airline’s pretax margin, excluding special items, is forecast between 4.5 and 6.5% for the current quarter. American said it cancelled nearly 8,000 flights due to the hurricanes, reducing pretax earnings by about $75m. “Despite the significant operational challenges posed by three hurricanes, our team delivered solid financial results,” Parker said.<br/>
https://portal.staralliance.com/cms/news/hot-topics/2017-10-27/oneworld/american-airlines-q3-profit-beats-street-shares-fall
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American Airlines Q3 profit beats street, shares fall
American Airlines reported a better-than-expected quarterly profit on Thursday on higher demand for business and leisure travel, but shares fell nearly 5% on factors including higher operating expenses. CEO Doug Parker said on an earnings call that the airline would work with a US civil rights group that called on Tuesday for black travellers to avoid American because of what the group called a pattern of racially biased incidents. “Discrimination, exclusion and unconscious biases are enormous problems that no one has mastered,” Parker said. For the current quarter, American said it expects revenue per available seat mile, a closely watched metric that compares sales to flight capacity, to rise between 2.5 and 4.5% from a year ago. American’s solid Q3 report came even as operations were hit by severe hurricanes. Still, shares closed down 4.72% at $48.61. The airline’s Q3 operating expenses swelled by 5.3% to $9.6b, a sore spot for investors. Increasing costs for fuel and labor have caused expenses to spike across the industry. Earlier this year, American said it offered an unexpected mid-contract pay increase to its pilots and flight attendants, which will cost an additional $230m for 2017 and $350m for 2018 and 2019. The airline’s pretax margin, excluding special items, is forecast between 4.5 and 6.5% for the current quarter. American said it cancelled nearly 8,000 flights due to the hurricanes, reducing pretax earnings by about $75m. “Despite the significant operational challenges posed by three hurricanes, our team delivered solid financial results,” Parker said.<br/>
