JetBlue Airways Airbus A320 passenger aircraft landing at John F. Kennedy International Airport in Latest York City.
Nik Oiko | LightRocket | Getty Images
JetBlue Airways shares tumbled Tuesday after a surge in costs drove it to a different quarterly loss just because it plans its takeover of Spirit Airlines.
The Latest York-based airline had a lack of $188 million within the second quarter on record revenue of near $2.45 billion because it grappled with an almost 35% increase in cost per available seat mile compared with three years ago. Fuel, labor and other expenses rose sharply last quarter.
Despite the loss, JetBlue said it expects to return to its first profit because the Covid pandemic began this quarter and that it could remain cautious on growth while costs surge.
JetBlue’s third-quarter capability will likely find yourself being down as much as 3% compared with 2019, an indication the carrier is holding back on growth like other airlines attempting to improve reliability after a rocky begin to an enormous summer travel season.
“We reported a record-breaking revenue result for the second quarter, and we’re on pace to top it again here within the third quarter and drive our first quarterly profit because the start of the pandemic,” CEO Robin Hayes said in an earnings release.
The airline estimated its revenue per available seat mile can be up as much as 23% this quarter as consumers swallowed high airfares that JetBlue expects to offset a jump in fuel costs. Excluding fuel, JetBlue forecast unit costs to be up 15% to 17% over 2019.
The airline said it can complete its retirement of Embraer E190 planes in mid-2025, greater than a 12 months sooner than previously scheduled. The faster transition to its more fuel-efficient Airbus A220 planes would help it cut costs, the corporate said.
Airfares have cooled barely as the height summer travel season fades but JetBlue said “early bookings keep us cautiously optimistic concerning the fall.”
JetBlue last week announced it had finally reached a deal to accumulate ultra-low-cost carrier Spirit Airlines for $3.8 billion in money after an extended bidding war with discounter Frontier Airlines. Frontier’s agreement to mix with Spirit fell apart hours before the JetBlue-Spirit deal was announced.
JetBlue shares were down greater than 6% in early trading Tuesday.