JetBlue posts quarterly profit as travel demand helps cover jump in costs

JetBlue Airways eked out a $57m profit for Q3 as strong travel demand and higher fares helped the carrier cover more expensive fuel and other costs. The New York-based airline’s revenue rose 30% during the quarter from the same period last year to $2.56b, in line with analysts’ estimates. JetBlue’s operating margin narrowed to 5.4% from 9.4% a year earlier after expenses rose nearly 36% from the same period of 2021. JetBlue’s CEO, Robin Hayes, said the carrier expects “another solid quarter of mid-single-digit pre-tax margins in the fourth quarter, and we’ll look to expand on that further in 2023 as we continue to restore our earnings power.” “While the revenue outlook is strong, we have to continue to be thoughtful about every penny we spend, particularly in today’s environment, since our entire business model of competing with lower fares is based on having lower costs relative to the legacy airlines,” JetBlue’s CFO, Ursula Hurley, wrote in a note to employees. Hurley said despite the quarterly results, the airline won’t post a full-year profit in 2022 “after the bumps we faced in the first half of the year with the Omicron variant and operational challenges.” Larger US carriers have been upbeat about travel demand and largely outperformed analysts’ expectations on resilient bookings, particularly on the return of international trips. Airline executives say they are limited in how much capacity they can add because of shortfalls in aircraft and pilots, which is helping keep fares high. Airlines have also held back on adding flights after a host of costly operational meltdowns prompted them to add more slack in the system. JetBlue said it plans to expand flying 1% to 4% in the fourth quarter compared with 2019 levels. Airlines are comparing capacity levels with those of three years ago to show their recovery from the Covid pandemic.<br/>