A passenger silhouette in front of a JetBlue Airbus A321neo spotted on the tarmac at the bridge of the passenger aircraft from Amsterdam Schiphol International Airport AMS EHAM terminal in the Netherlands.
Nicholas Economou | norphoto | Getty Images
Shares of JetBlue Airways fell more than 10% in premarket trading Tuesday after the airline cut its revenue forecast for 2024, a setback as the carrier tries to return to profitability.
JetBlue said second-quarter revenue will likely fall by as much as 10.5% over the year, more than double the decline expected by analysts polled by LSEG. The New York-based carrier expected full-year sales to fall by low single digits, also lower than Wall Street expectations, after estimating flat sales for the year in its January report.
JetBlue has been cutting costs, culling unprofitable routes and focusing on those with consistent demand and high premium seat sales. The carrier last month canceled its merger agreement with budget airline Spirit Airlines after a judge blocked that $3.8 billion deal on antitrust grounds.
Tuesday's forecast update shows a growing divide between JetBlue and larger rivals with large international networks like Delta and United, which forecast strong profits, revenues and record demand this summer.
“As we look to the full year, there is a significant increase in capacity in our Latin region [America] “The region, which represents a significant portion of JetBlue's network, is likely to continue to put pressure on revenues and we expect a setback in our full-year outlook,” said Joanna Geraghty, who became CEO in February. In the earnings statement. “We have every confidence that continuing to take action on our refocused independent strategy is the right path forward to ultimately return to profitability again.”
JetBlue is affected by a Pratt & Whitney engine recall that grounded some of its planes. In an investor presentation on Tuesday, JetBlue said it was “actively exploring” further cost reductions.
JetBlue said earlier this year that it would postpone $2.5 billion in aircraft spending until the end of the year.
In the first three months of the year, JetBlue lost $716 million, or a loss of $2.11 per share, compared to a loss of $192 million, or a loss of 58 cents per share, in the same period in 2023.
After adjusting for one-time items, JetBlue lost $145 million, or 43 cents per share, lower than the adjusted loss of 52 cents expected by analysts surveyed by LSEG.
Revenue declined 5.1% from a year ago to $2.21 billion, which was in line with LSEG's revenue forecast.
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