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Investing.com -- United Airlines reported a quarterly profit above Wall Street estimates and forecast record revenue in the current quarter, betting on strong travel demand and customer loyalty.
The carrier posted adjusted earnings of $2.78 per share for the third quarter, beating analyst estimates of $2.67, while revenue rose 2.6% to $15.2 billion, narrowly missing the $15.33 billion consensus.
While customers were willing to pay higher prices for more comfortable seats and United’s frequent flyer program showed strength, operational issues at Newark airport -- a key hub for United -- weighed on its quarterly top-line returns.
United’s shares were lower by more than 2% in premarket U.S. trading on Thursday.
"[W]e would caution investors from focusing too much on third-quarter revenue coming in below consensus. We believe investors should instead focus on the resilience enabled by United’s diverse revenue streams and the encouraging demand environment exiting the year," analysts at TD Securities said in a note.
United forecast adjusted earnings of $3 to $3.50 per share for the fourth quarter, above market expectations of $2.82, and said it expects the period to deliver the highest operating revenue in its history, thanks in part to elevated fares driven up by reduced airline seat capacity.
CEO Scott Kirby said investments in customer experience, including upgraded seats, inflight Wi-Fi through Starlink and improved service across cabins, have helped the airline build a base of brand-loyal travellers that supported results through a volatile year.
United said it will invest more than $1 billion in customer-focused upgrades this year and another $1 billion in 2026. Premium-cabin revenue rose 6% year-on-year in the third quarter, while loyalty revenue climbed 9%.
The Chicago-based carrier flew its largest summer mainline schedule ever and achieved its lowest third-quarter cancellation rate in company history. Capacity grew 7.2% from a year earlier, while unit revenue fell 4.3%.
(Scott Kanowsky contributed reporting.)