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United Airlines Holdings Inc. reported third-quarter earnings late Tuesday that were better than Wall Street expected, but the airline’s stock fell as the company called for lower profits later in the year.
United
UAL,
earned $1.1 billion, or $3.42 a share, in the quarter, compared with $942 million, or $2.86 a share, in the same quarter a year earlier. Adjusted for one-time items, the airline earned $3.65 a share.
Sales rose to $14.5 billion from $12.9 billion a year ago.
Analysts polled by FactSet expected United to report adjusted earnings of $3.38 a share on sales of $14.4 billion.
United said it expects fourth-quarter earnings of about $1.80 a share if flights to Tel Aviv are suspended through October, and of around $1.50 a share if the Tel Aviv flights are suspended through the end of the year. The Israel-Hamas war has raged for a little over a week.
Wall Street forecast fourth-quarter earnings of $2.09 a share. United’s stock dropped more than 4% in the extended session Tuesday after ending the regular trading day up 1.5%.
United earlier this month said it placed orders for an additional 110 new jets from Boeing Co.
BA,
and Airbus SE
AIR,
as it expected air-travel demand to continue unabated.
The airline in 2021 launched its United Next plan, promising more savings by using newer, more fuel-efficient jets. These newer planes often offer premium seating, allowing the airline to sell more profitable, rarely discounted first-class and business seats.
United’s stock has gained 7% so far this year, compared with an advance of about 14% for the S&P 500 index
SPX.
United is slated to hold a conference call to discuss the third-quarter results and the update through the end of the year on Wednesday at 10:30 a.m. Eastern.
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