JetBlue outlook sparks sell-off in shares

JetBlue Airways shares plunged 28% on Tuesday after the New York-based carrier forecast lower-than-expected unit revenue and higher costs in the current quarter. The company, however, said it expects improvements in its performance in subsequent quarters and sees an adjusted operating margin in the range of 0.0% to 1% in 2025. Analysts at Raymond James said the forecast implied a loss of 75 cents a share for the year. That compares with analysts' average expectations for a loss of 58 cents a share, according to data compiled by LSEG. JetBlue's shares were down 28% at $5.82 in afternoon trade. The carrier forecast first-quarter revenue per available seat mile (RASM), an industry metric commonly known as unit revenue and a proxy for pricing power, of a decline of 0.5% to 3.5% growth. Analysts had been estimating a 6.88% growth. JetBlue said it expects Easter falling in the second quarter this year will reduce unit revenue by about 1.5% in the current quarter, delaying often strong holiday sales. The outlook contrasts with that of rivals such as Delta and United, which have forecast stronger-than-expected revenue. JetBlue attributed its downbeat outlook to lower exposure to corporate traffic as well as greater competitive pressure in some of its key markets. "We expect competitive capacity will continue to ebb and flow," JetBlue President Marty St. George told analysts on a call to discuss results.<br/>