Mixed Bag for United

It was a good news/bad news thing for United as the carrier beat Wall Street expectations during Q1, but then revised its guidance downward for the rest of the year. The airline adjusted earnings down between $1 and $2 per share for Q2, and its year-end guidance to $7-$11 profit per share, down from the $12-$14 previously forecasted thanks to high fuel prices.

For Q1, United earned $14.6 billion in gross revenue, beating the expected figure of $14.4 billion. This reflected a 10% leap from ’24 when it earned $13.2 billion in Q1. But profit is where it took the biggest step forward, besting ’25 by 80%, as it finished the quarter just shy of $700 million on the upside. Domestic flights saw an 8% bump in unit revenue from last year, up to $7.9 billion.

United operated at a load factor of 81.6%, up 2.4% from 2025. It carried the most passengers it ever has in a first quarter, and some of them didn’t have to connect through Newark. It ended Q1 with $7.8 billion of cash and cash equivalents on-hand and it is reportedly looking to grow its real estate portfolio as CEO Scott Kirby was seen bookmarking several Zillow pages for new homes for his executive team in the Fort Worth area.

American’s Q1 Also Hit by the Fuel Bug

American set a company record for Q1 revenue at $13.9 billion but came up $382 million in the red as fuel-related costs and general operational struggles took hold to start the year. CEO Robert Isom said he expects another gross revenue record in Q2 as well, which makes sense as fares and fees are only headed in one direction. The $382 million loss is an improvement from Q1 last year where it lost $473 million.

AA’s stock lost $0.40, which is better than the $0.47 expected, and it did lower its total debt to $34.7 billion, the lowest it’s been in a decade. For Q2 it expects its stock to fall somewhere between up $0.20 and down $0.20 as it navigates what it projects as a $4 billion fuel bill bigger than last year. When asked to comment on its future stock price, AA officials directed all questions to United’s investor relations team. “It’ll be their problem soon enough,” one person remarked to Cranky on the condition that we not release his or her name, only that it rhymed with “Schmisom.”

The airline has just short of $11 billion in liquidity, much of which is expected to be put into 529 savings accounts in the names of the children of employees of the Chicago Department of Aviation.

Will Spirit be Saved by the Federal Government?

With Spirit staring down the barrel of bankruptcy and liquidation, it is looking into the time-honored tradition of failing businesses in this country… to seek a bailout from American taxpayers to keep the doors open. The president was non-committal on what the government would do, but in a bizarre rant worthy of your senile grandparents, he did lament the fact that President Obama prevented a merger with PEOPLExpress. (We aren’t making this up, but he certainly was.)

A $500 million bailout seems to be on the table which would help it avoid becoming the first major airline to shut down in the United States since, what, Pan Am in 1991? (This assumes you don’t count aha!) Federal government bailouts of airlines have typically been done on an industry-wide basis, with this potentially being a precedent-breaking bailout. Spirit has been mum on its future plans, saying its day-to-day operations are unaffected as this drama plays out in South Florida, Washington, D.C., and beyond.

An attorney for Spirit did confirm in bankruptcy court Thursday that a federal government lifeline is being discussed. Commerce secretary Howard Lutnick is reportedly a major advocate for the deal within the government which makes sense when looking at his personal balance sheet and seeing that he his heavily leveraged with yellow paint futures. A new court hearing is set for Thursday, April 30 to consider a potential offer.

Members of the banking industry were asked for their opinion on the bailout and had no comment.

Southwest Managed a Profitable Quarter

Despite doom and gloom for most airlines, Southwest managed to escape the barrage of red ink in Q1, which probably fuels the idea in some corners that the New Southwest is working as a concept.

The Dallas-based carrier earned a $227 million profit on record Q1 passenger revenue of US$6.6 billion. Southwest saw RASM increase 11.2% on a 1.5% jump in capacity. The airline says about 60% of customers purchased some sort of upgrade from its base product, a jump from 20% a year ago. Southwest also set record revenue in its black market sale of customer tears, as it took all the whining customers did to check-in and gate agents, bottled them up, and sold that for a tidy profit.

It paid $2.75 at the pump averaged for the quarter, higher than the $2.40 forecasted. But it believes Q2 fuel prices could be as high as $4.15 per gallon. To make up for that increase, the airline will increase the price of its new extra legroom seating options to $599 per segment.

For Q2, Southwest projects adjusted earnings per share of $0.35-$0.65, assuming fuel prices between US$4.10 and US$4.15. The airline elected not to update its full-year earnings target of $4, pointing its finger out towards the world, shrugging its shoulders and saying “who really knows what’s next?”

Alaska and Hawaiian’s Busy Week

A lot of news came out of Seattle and Honolulu this week, starting with the two airlines converging their booking systems to a shared Sabre platform. Customers can now purchase flights and manage bookings on the new combined app, while the two are bringing their check-in process together at most major mainland airports. Hawaiian’s HA code is now a thing of the past, with all flights operating under Alaska’s AS code and Hawaiian flights being denoted as Hawaiian Airlines operated by Alaska.

Hawaiian also got the codeword to enter oneworld’s clubhouse this week as the carrier was formally welcomed into the alliance, bumping Oman Air out of the “new guy” chair. Hawaiian brought ukuleles and POG juice to its first formal meeting of the alliance and promised to host next month’s meeting at the end of the Road to Hana on Maui.

Lastly, Alaska posted its Q1 earnings this week as well. The headline was that it led the industry in on-time performance, which, while an admirable goal, is never what you want headlining your earnings report. Alaska lost $193 million — or $1.69 per share — in the quarter, on $3.3 billion in gross revenue. Alaska declined to give future guidance, citing the volatility with fuel as the reason, but did say it expects capacity to be up 1% in Q2 compared to last year.

• Air Canada took delivery of its first A321XLR today.
• American is opening a new Admirals Club in Nashville.
• Contour is adding Merced, CA. to its route map making Central Valley fans very happy.
• El Al is headed to Argentina.
• Ethiopian is converting six B787 options into firm orders.
• Etihad will increase its service to Charlotte from 4x weekly to 1x daily this summer.
• Fiji Airways is capping seats.
• flydubai will begin flying to Bangkok on July 1.
• Frontier Airlines avoided a $162k fine.
• IndiGo signed an 8-year agreement with Delta TechOps to maintain 20 engines.
• ITA is flying to Santo Domingo now.
• JetBlue won’t file for bankruptcy this year, says the person whose job depends on it not filing for bankruptcy.
• Philippine Airlines is adding nine airplanes this year.
• Riyadh Air is adding Jeddah, Madrid, and Manchester.
• Ryanair is closing its Berlin base.
• Southwest is adding four for the holidays: San Francisco to Kansas City, Cleveland to Dallas, Jacksonville to Las Vegas, and San Diego to Fort Lauderdale.
• TAROM is restructuring. Maybe.
• United is sticking to its policy of charging for non-Starlink Wi-Fi.
• Volotea is ITA’s newest codeshare partner.

I have been trying to teach myself how to drive a stick shift, but I can’t find a manual anywhere.