JetBlue shares tumble 25% after disappointing outlook

JetBlue Airways shares fell more than 25% on Tuesday and are on track for the biggest one-day percentage loss since the company went public more than two decades ago, after the carrier’s financial outlook disappointed investors.

The New York-based airline forecast its unit costs, excluding fuel, will rise as much as 7% this year from 2024. In the first quarter, it said it expected this metric to rise as much as 10% this quarter year-over-year.

It estimated revenue could come in up to 0.5% lower to as much as 3.5% higher this quarter over 2024. Larger competitors Delta and United have been forecasting higher revenue growth, a sign of those airlines’ strengthening pricing power.

JetBlue is in the middle of a plan to reduce costs by culling unprofitable routes, deferring new aircraft and drumming up revenue with higher-priced seats. CNBC reported Friday that JetBlue has offered senior pilots voluntary early retirement packages. JetBlue cut costs by $190 million last year, the company said Tuesday.

“This is a multiyear strategy, and it’s not linear, and we’re focused on the long term here in getting JetBlue back to sustained profitability,” CEO Joanna Geraghty, who took the top job last year, said during an earnings call on Tuesday. “So it’s going to take a little time.”

Geraghty added she was pleased with the carrier’s progress, which puts it on track to add up to $900 million to pretax profit 2027.

The carrier expects its 2025 revenue to rise between 3% and 6% on flat capacity. The impact of a Pratt & Whitney engine recall will be worse this year, grounding a number of the company’s Airbus jets in the “mid- to high teens, up from 11 grounded aircraft last year,” CFO Ursula Hurley said on the earnings call Tuesday.

JetBlue is in the middle of a plan to reduce costs by culling unprofitable routes, deferring new aircraft and drumming up revenue with higher-priced seats. CNBC reported Friday that JetBlue has offered senior pilots voluntary early retirement packages.

JetBlue lost two antitrust cases that blocked two of its growth strategies. In 2024, a federal judge blocked JetBlue’s planned acquisition of Spirit Airlines, which filed for Chapter 11 bankruptcy protection in November, and in 2023, JetBlue lost a case over its regional partnership with American Airlines.

“We would note that the current management team has hit their numbers, but in a market where airlines are seeing solid earnings growth, JetBlue hasn’t been able to keep pace,” wrote Melius Research analyst Conor Cunningham. “JetBlue still needs to aggressively ramp unit revenue throughout the year to get to sustained operating profit – all possible, it just is hard to underwrite given the drag in 1Q.”

JetBlue’s fourth-quarter loss narrowed to $44 million, or a loss of 13 cents per share, down from a loss of $104 million, or a loss of 31 cents a share, in the same period in 2023. The carrier reported revenue of $2.28 billion, down 2.1% from a year earlier.