United posts $473 million 3Q profit on federal pandemic aid
United Airlines is reporting a $473 million profit for the third quarter, which covers much of the peak summer travel season
United Airlines reported a $473 million profit for the third quarter thanks to more than $1 billion in federal pandemic aid that helped pay airline employees this summer.
The airline said Tuesday that bookings started to stabilize last month as the spike in COVID-19 cases eased.
Still, Chicago-based United said that its fourth-quarter revenue will be 25% to 30% lower than during the same period of 2019 as the airline operates fewer flights than it did before the pandemic. Costs will rise on a per-seat basis.
Ordinarily United draws a large chunk of revenue from business and international travel, but both remain severely depressed. United and its closest rivals, American and Delta, hope to get a boost from the U.S. government’s decision to ease restrictions on vaccinated travelers from abroad on Nov. 8.
Domestic leisure travel has returned to roughly pre-pandemic levels. That prompted United to announce this month that it plans its biggest domestic schedule of flights since March 2020 to meet what it expects will be a surge in holiday travel.
For the third quarter, United’s $473 million profit compared with a loss of $1.84 billion last year and profit of $1.02 billion in the third quarter of 2019.
United said that excluding special items such as federal aid it would have lost $1.02 per share. That was better than analysts expected — a loss of $1.58 per share, according to a FactSet survey.
Revenue was $7.75 billion, about $110 million more than analysts expected but 32% below the same period in 2019.
Last week, Delta Air Lines reported a $1.2 billion profit for the third quarter but warned that rising fuel prices and labor costs will lead to a “modest” fourth-quarter loss.
United forecast that expenses other than fuel will rise by 12% to 14% per seat in the fourth quarter — roughly double the increase that Delta predicted. Airlines are scrambling to hire more pilots, flight attendants and other workers in a reversal of last year, when the carriers were hemorrhaging cash and encouraging employees to quit.
United officials declined to comment on the report until they hold a conference call with analysts and reporters on Wednesday.
Shares of United Airlines Holdings Inc. rose 1% in the first minutes of extended trading after release of the financial report. They ended the regular session down 2%, at $46.22.
David Koenig can be reached at www.twitter.com/airlinewriter