A United Airlines Boeing 737-MAX 8 departs from San Diego International Airport on its way to New York on August 24, 2024.
Kevin Carter | Getty Images
united airlines announced Tuesday that it will launch a $1.5 billion share buyback as the company reported better-than-expected earnings during the busy summer travel season and expects strong results in the final three months of the year. did.
United Airlines expects fourth-quarter adjusted earnings of $2.50 to $3 a share, compared with $2 a share in the year-ago period and $2.68 a share from analysts surveyed by LSEG.
Below is a comparison of United’s third-quarter report to Wall Street expectations, based on average estimates compiled by LSEG.
Earnings per share: $3.33 adjusted vs. $3.17 expected Revenue: $14.84 billion vs. $14.78 billion expected
This is United’s first stock buyback since before the coronavirus pandemic. U.S. airlines received more than $50 billion in government aid while stock buybacks and dividends were banned during the pandemic-induced travel downturn, but airlines were still fighting for financial stability.
southwest airlines announced a $2.5 billion stock repurchase program last month.
“Like other major airlines and companies, we have begun a prudent and strategic stock repurchase program,” United Airlines CEO Scott Kirby said in a memo to employees Tuesday. ” he said. “Importantly, investing in our people and our business remains my top priority as we launch this share buyback program.”
United Airlines’ revenue for the third quarter was $14.84 billion, an increase of 2.5% from the same period a year ago, beating analyst expectations. Net income was $965 million, down 15% from the same period last year.
United Airlines said domestic unit revenue was positive in August and September compared with a year ago as the airline cut excess flights that were driving down fares. United Airlines expanded capacity by 4.1% in the third quarter. The news agency said corporate revenue rose 13% in the quarter. Premium revenue, which includes business class tickets, increased by 5%. And sales of no-frills basic economy tickets increased by 20%.
The airline last week announced extensive expansion for next year, including new flights to Mongolia, Senegal, Spain and Greenland, in pursuit of international travel demand.
United Airlines reported earnings per share of $3.33, adjusted for one-time items, beating Wall Street expectations and United’s July estimate of $2.75 to $3.25 per share.
Airline executives are scheduled to hold a call with analysts at 10:30 a.m. ET on Wednesday and are likely to face questions about demand and airline production issues through the end of the year and into 2025. . boeingMost factories are not operating during the machinists’ strike that has lasted more than a month.