Silhouette of passenger in front of the JetBlue Airbus A321neo aircraft spotted on the apron tarmac docked at the passenger jet bridge from the terminal of Amsterdam Schiphol International Airport AMS EHAM in the Netherlands.Â
Nicholas Economou | Nurphoto | Getty Images
JetBlue Airways shares tumbled more than 10% in premarket trading on Tuesday after the airline lowered its 2024 revenue forecast, a setback as the carrier tries to return to profitability.
JetBlue said second-quarter revenue would likely drop as much as 10.5% on the year, more than double the drop analysts polled by LSEG expected. The New York-based carrier forecast full-year sales would drop in the low single digits, also below Wall Street expectations, after estimating flat sales for the year in its January report.
JetBlue has been on a cost-cutting spree, culling unprofitable routes and focusing on those with steady demand and high sales for premium seats. The carrier last month called off its merger agreement with budget carrier Spirit Airlines after a judge blocked that $3.8 billion deal on antitrust grounds.
The outlook update Tuesday shows a growing divide between JetBlue and its larger rivals that have big international networks like Delta and United, which have forecast profits, strong revenue and record demand this summer.
“As we look to the full year, significant elevated capacity in our Latin [America] region, which represents a large portion of JetBlue’s network, will likely continue to pressure revenue and we expect a setback in our expectations for the full year,” Joanna Geraghty, who became CEO in February, said in an earnings release. “We have full confidence that continuing to take action on our refocused standalone strategy is the right path forward to ultimately return to profitability again.”
JetBlue is affected by a Pratt & Whitney engine recall that has grounded some of its planes. In an investor presentation on Tuesday, JetBlue said it was “actively exploring” more cost cuts.
JetBlue earlier this year said it would defer $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 with a loss of $192 million, or a loss of 58 cents a share, in the same period of 2023.
Adjusting for one-time items, JetBlue lost $145 million, or 43 cents per share, narrower than the 52 cent adjusted loss analysts polled by LSEG expected.
Revenue dropped 5.1% from last year to $2.21 billion, matching LSEG revenue expectations.
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