American Airlines cut its full-year 2026 earnings forecast, projecting adjusted earnings per share between a loss of $0.40 and a profit of $1.10 — down from its January forecast of $1.70 to $2.70 per share — as jet fuel costs weigh heavily on margins.
Even as the revised guidance midpoint holds roughly level with last year's results, the airline is absorbing a fuel bill projected to climb by more than $4 billion, with per-gallon costs running near $4.00 in the current quarter.
First-quarter results came in ahead of Wall Street expectations, with adjusted loss per share of $0.40 beating the $0.47 consensus estimate, according to CNBC. On a net basis, the quarter produced a $382 million loss, or $0.58 per share. Total revenue of $13.91 billion represented a 10.8% increase from the $12.55 billion recorded in the same period a year ago, topping the $13.79 billion analysts had expected.
Looking ahead to the second quarter, the company guided for revenue expansion of 13.5% to 16.5% compared with the prior year, while its adjusted earnings per share outlook spans from a $0.20 loss to a $0.20 gain — a range that falls short of the $0.09 loss analysts had penciled in, according to Reuters.
CEO Robert Isom said the airline remains prepared to respond to cost pressures. "We're going to recover, but key to that is just supply and demand balance," Isom told CNBC. "We're going to be quick to make sure that we adjust our flying if we need to."
American is not alone in revising its outlook. Across the industry, carriers have been revising their financial outlooks as fuel prices surged in the wake of U.S.-Israeli strikes on Iran; the conflict choked oil flows through the Strait of Hormuz, which Reuters describes as a critical corridor for global energy supplies. Because tickets are sold well ahead of travel, airlines had locked in fares before the price spike took hold — a dynamic that has left carriers absorbing costs that have come close to doubling since the fighting began.
To offset the impact, carriers have turned to a combination of higher ticket prices, slower capacity expansion, and steeper charges on add-ons such as checked luggage, according to Reuters.
Despite the cost environment, American said demand has held steady. Managed corporate revenue rose 13% year over year in the first quarter, and premium cabin unit revenue continued to outperform the main cabin. The company also reported record first-quarter AAdvantage loyalty program enrollments, up 25% year over year.
American ended the quarter with total debt of $34.7 billion — its lowest level since mid-2015 — and $10.8 billion in liquidity, the company said.