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American Airlines posts third-quarter loss and trims 2023 profit forecast

American Airlines posted a Q3 loss on Thursday and trimmed its profit forecast for the year, partly in response to higher fuel prices. The carrier said Thursday it expects to earn between $2.25 and $2.50 a share, on an adjusted basis, for the year, down from an estimate in July of $3 to $3.75 but largely in line with analyst expectations. American said it expects a full-year adjusted operating margin of 7%, down from a previous forecast for as wide a margin as 10%. For the fourth quarter, American estimated it would break even. American said it expects unit revenue in the fourth quarter to drop between 5.5% and 7.5% from a year earlier with unit costs, excluding fuel, up 5% to 7% year over year and capacity up 4.5% to 6.5% from the same period of 2022. The company lost $545m, or 83 cents per share, during Q3, down from a profit of $483m, or 69 cents per share during the same period a year earlier. It was the carrier’s first loss since Q1 2022. Capacity was up 7% from a year ago. CEO Robert Isom told staff in a note that “while there were bumps along the way, such as significantly higher fuel costs that resulted in lower earnings in the quarter, our team continues to excel at controlling what we can control, which will make us successful no matter the environment.”<br/>

Alaska Air cuts profit view as rising labor costs cast shadow

Alaska Air Group cut its full-year profit outlook on Thursday on rising labor expenses, as airlines draw up costly contracts to retain employees. Major U.S. airlines are already feeling the pinch from higher fuel prices, putting a dampener on their outlooks. Washington State-based Alaska Air said it is moderating capacity growth for the next two quarters to make it more in line with pre-pandemic levels. It expects capacity growth through February 2024 to be up less than 3% over 2019 levels. The development comes at a time when investors fear demand may soften, particularly for domestic routes, as a depletion of pandemic savings and high interest rates have crimped consumers' tolerance for pricier airfare. Alaska Air forecast full-year profit between $4.25 and $4.75 per share, lower than its prior expectation of $5.50 to $7.50. The airline also trimmed its annual revenue growth forecast to between 7% and 8%, from a range of 8% to 10% expected previously.<br/>