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Major airlines have been benefiting from an unprecedented surge in travel demand as consumers, faced with constrained budgets, cut their spending on goods for experiences.
The company forecast adjusted profit of $3.00 to $3.75 per share compared with its prior outlook of $2.50 to $3.50 per share for 2023.
Boosting profits, jet fuel costs in North America are down about 30% from a year ago, but there are signs flight fares might be cooling off.
Last week, concerns about flight ticket prices were further fueled by U.S. inflation data that showed a third consecutive monthly decline in airline fares. They dropped at their fastest pace year-over-year since February 2021.
Peers United Airlines and Delta Air Lines (NYSE:DAL) have also raised their 2023 profit expectations after reporting bumper earnings.
American’s adjusted net income for the second quarter ended June 30 was $1.92 per share, beating analysts’ average expectations of $1.59.
The carrier expects total revenue per available seat mile, a proxy for pricing power for its third quarter to be down about 4.5% to 6.5% compared to last year.
Its total operating revenue rose 4.7% to $14.06 billion, above a Wall Street consensus of $13.74 billion.
