TLDR
- American Airlines delivered a Q1 adjusted loss of $0.40 per share, surpassing expectations for a $0.47 loss
- Quarterly revenue reached an all-time high of $13.91 billion, marking a 10.8% increase from the prior year and exceeding the $13.79 billion forecast
- Average fuel expenses surged 10.7% to $2.75 per gallon, with projections indicating a spike to $4 per gallon
- Annual earnings guidance of -$0.40 to +$1.10 per share surpassed Wall Street’s projection of a -$0.65 loss
- AAL shares climbed approximately 2% in premarket hours despite a 25% decline year-to-date as of Wednesday
American Airlines delivered first-quarter results that showed an adjusted loss of 40 cents per share, performing better than the Wall Street estimate calling for a 47-cent loss. The carrier’s quarterly revenue reached an all-time high of $13.91 billion, representing a 10.8% year-over-year increase and surpassing the consensus forecast of $13.79 billion.
Passenger traffic climbed 3.9% to reach 58.55 billion revenue passenger miles. Meanwhile, available capacity expanded at a slower pace of 3%, totaling 72.01 billion available seat miles, which resulted in the load factor improving by 0.7 percentage points to 81.3%.
This quarter represents the third time in the last five quarters that the airline has reported a loss, though the per-share deficit narrowed compared to the 59-cent loss recorded in the corresponding period of the previous year.
American Airlines Group Inc., AAL
Shares gained ground in premarket activity — advancing roughly 2% — following a challenging year that has witnessed AAL decline 25% through Wednesday’s trading session.
Fuel expenses continue to dominate the narrative. The carrier’s average fuel price per gallon increased 10.7% during Q1 to reach $2.75. Management’s forward projections now anticipate this figure will escalate dramatically to $4 per gallon.
$4 Billion Fuel Expense Increase Casts Shadow Over Annual Projections
American highlighted an anticipated fuel-related cost increase exceeding $4 billion in its annual forecast. This represents a substantial financial burden for any airline operator.
Despite this significant challenge, management indicated that the midpoint of its full-year guidance remains approximately level with 2025 performance. The annual earnings guidance spans from -$0.40 to +$1.10 per share.
Wall Street analysts had previously projected a full-year loss of 65 cents per share, based on FactSet data. Consequently, even accounting for the fuel cost warning, American’s outlook exceeded pessimistic expectations.
The carrier also anticipates second-quarter revenue growth in the range of 13.5% to 16.5% compared to the prior-year period — which would establish another record. The current FactSet consensus for Q2 of $16.37 billion represents 13.8% growth.
Industry-Wide Turbulence Affects Airline Stocks
American follows the lead of other prominent U.S. airlines in adjusting or pausing annual guidance. The dramatic increase in fuel prices connected to geopolitical tensions involving Iran has compelled carriers to reassess capacity planning and pricing strategies.
Management stated it anticipates sustained strong passenger demand and plans to “recapture elevated fuel prices” — language that generally indicates forthcoming fare increases.
The U.S. Global Jets ETF has declined 7.8% in 2026 thus far, contrasting with the S&P 500’s 4.3% gain during the identical timeframe.
AAL shares traded approximately 1.3% higher in premarket activity Thursday following the earnings release.
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