United Airlines announced a 15% decline in its third-quarter profit compared to last year, citing pressures from low-cost airlines but noting an improvement in revenue trends, the Associated Press reports.
The Chicago-based airline posted a profit of $965 million for the quarter, down from $1.14 billion a year earlier. However, revenue increased by 2.5% to $14.84 billion, surpassing analysts’ expectations.
United attributed the improved revenue outlook to budget carriers like Spirit and Southwest reducing their growth plans, which helped stabilize pricing in the competitive economy-class market. By late summer, United saw stronger demand in both premium and basic economy travel, with key metrics such as revenue per seat improving in August and September.
The airline’s board also approved a share buyback program of up to $1.5 billion, its first since 2020, when pandemic relief restrictions prevented such moves. United’s CEO Scott Kirby described the buyback as a “measured, strategic” approach, but it has faced backlash from the Association of Flight Attendants, which is currently in prolonged contract negotiations with the airline.
Despite the profit drop, United exceeded earnings estimates with adjusted earnings of $3.33 per share, higher than analysts’ forecasts of $3.17. Looking ahead, the airline projects fourth-quarter earnings between $2.50 and $3 per share, in line with market expectations.
United’s stock dipped slightly, falling 0.5% in after-hours trading following the earnings report.
