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JetBlue Airways Corporation’s (JBLU - Free Report) second-quarter 2018 earnings per share (excluding 76 cents from non-recurring items) of 38 cents surpassed the Zacks Consensus Estimate of 36 cents. However, the bottom line decreased significantly on a year-over-year basis primarily due to high fuel costs.
Total operating revenues of $1,928 million fell marginally short of the Zacks Consensus Estimate of $1,931.2 million. Nevertheless, the top line increased approximately 5% from the year-ago figure. Passenger revenues, which accounted for bulk of the top line (96.4%), were up 5.2% in the quarter under review. Other revenues were roughly flat year over year.
Operating Statistics
Capacity, measured in available seat miles, expanded 6.3% year over year. Traffic — measured in revenue passenger miles — grew 7.5% in the reported quarter. Load factor (percentage of seats filled by passengers) improved 100 basis points (bps) year over year to 86.2% as traffic growth outpaced capacity expansion in the three-month period.
Yield per passenger mile declined 2.2% year over year to 14.24 cents. The average fare at JetBlue declined 0.7% to $170.08.
Passenger revenue per available seat mile (PRASM: a key measure of unit revenue) decreased 1% to 12.27 cents. Moreover, operating revenue per available seat mile (RASM) was down 1.2% to 12.74 cents. The metric was negatively impacted by the shift in holiday travel into the first quarter.
Expenses
In the second quarter, total operating expenses (on a reported basis) increased 39.1% year over year mainly owing to high fuel costs. Average fuel cost per gallon (including fuel taxes) escalated 41.7% to $2.28. Moreover, JetBlue’s operating cost per available seat mile (CASM) was up 30.9% to 13.69 cents. Excluding fuel, the metric climbed 1.9% to 8.26 cents on account of a rise in labor costs.
Balance Sheet
JetBlue, carrying a Zacks Rank #3 (Hold), exited the quarter with cash and cash equivalents of $603 million compared with $303 million at the end of 2017. Total debt, at the end of the second quarter was $1,358 million than $1,199 million at the end of 2017. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
JetBlue Airways Corporation Price, Consensus and EPS Surprise
For the third quarter of 2018, the carrier expects capacity to increase between 7.5% and 9.5%. The metric is anticipated to increase in the range of 6.5-7.5% for 2018 (including a reduction of 2 points for fourth-quarter capacity growth).
Consolidated operating cost per available seat mile, excluding fuel, is expected to grow in the band of 1-3% in the third quarter. For the current year, the metric is still projected in the range of -1% to +1% (year over year).
RASM growth is anticipated to be between 0% and 3% in the third quarter. Third-quarter fuel cost, net of hedges, is envisioned to be $2.33 per gallon.
Upcoming Releases
Investors interested in the broader Transportation sector are keenly awaiting second-quarter earnings reports from key players, namely Norfolk Southern Corporation (NSC - Free Report) , United Parcel Service, Inc. (UPS - Free Report) and Genesee & Wyoming Inc. . While Norfolk Southern and UPS will report second-quarter earnings on Jul 25, Genesee & Wyoming will do the same on Jul 27.
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Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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JetBlue (JBLU) Tops Q2 Earnings Estimates, Declines Y/Y
JetBlue Airways Corporation’s (JBLU - Free Report) second-quarter 2018 earnings per share (excluding 76 cents from non-recurring items) of 38 cents surpassed the Zacks Consensus Estimate of 36 cents. However, the bottom line decreased significantly on a year-over-year basis primarily due to high fuel costs.
Total operating revenues of $1,928 million fell marginally short of the Zacks Consensus Estimate of $1,931.2 million. Nevertheless, the top line increased approximately 5% from the year-ago figure. Passenger revenues, which accounted for bulk of the top line (96.4%), were up 5.2% in the quarter under review. Other revenues were roughly flat year over year.
Operating Statistics
Capacity, measured in available seat miles, expanded 6.3% year over year. Traffic — measured in revenue passenger miles — grew 7.5% in the reported quarter. Load factor (percentage of seats filled by passengers) improved 100 basis points (bps) year over year to 86.2% as traffic growth outpaced capacity expansion in the three-month period.
Yield per passenger mile declined 2.2% year over year to 14.24 cents. The average fare at JetBlue declined 0.7% to $170.08.
Passenger revenue per available seat mile (PRASM: a key measure of unit revenue) decreased 1% to 12.27 cents. Moreover, operating revenue per available seat mile (RASM) was down 1.2% to 12.74 cents. The metric was negatively impacted by the shift in holiday travel into the first quarter.
Expenses
In the second quarter, total operating expenses (on a reported basis) increased 39.1% year over year mainly owing to high fuel costs. Average fuel cost per gallon (including fuel taxes) escalated 41.7% to $2.28. Moreover, JetBlue’s operating cost per available seat mile (CASM) was up 30.9% to 13.69 cents. Excluding fuel, the metric climbed 1.9% to 8.26 cents on account of a rise in labor costs.
Balance Sheet
JetBlue, carrying a Zacks Rank #3 (Hold), exited the quarter with cash and cash equivalents of $603 million compared with $303 million at the end of 2017. Total debt, at the end of the second quarter was $1,358 million than $1,199 million at the end of 2017. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
JetBlue Airways Corporation Price, Consensus and EPS Surprise
JetBlue Airways Corporation Price, Consensus and EPS Surprise | JetBlue Airways Corporation Quote
Outlook
For the third quarter of 2018, the carrier expects capacity to increase between 7.5% and 9.5%. The metric is anticipated to increase in the range of 6.5-7.5% for 2018 (including a reduction of 2 points for fourth-quarter capacity growth).
Consolidated operating cost per available seat mile, excluding fuel, is expected to grow in the band of 1-3% in the third quarter. For the current year, the metric is still projected in the range of -1% to +1% (year over year).
RASM growth is anticipated to be between 0% and 3% in the third quarter. Third-quarter fuel cost, net of hedges, is envisioned to be $2.33 per gallon.
Upcoming Releases
Investors interested in the broader Transportation sector are keenly awaiting second-quarter earnings reports from key players, namely Norfolk Southern Corporation (NSC - Free Report) , United Parcel Service, Inc. (UPS - Free Report) and Genesee & Wyoming Inc. . While Norfolk Southern and UPS will report second-quarter earnings on Jul 25, Genesee & Wyoming will do the same on Jul 27.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>