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United Airlines Holdings, Inc. (UAL - Free Report) reported second-quarter 2023 earnings per share (EPS) of $5.03, which outpaced the Zacks Consensus Estimate of $3.99 and improved more than 100% year over year.
Operating revenues of $14,178 million beat the Zacks Consensus Estimate of $13,927.1 million. UAL’s revenues increased 17.1% year over year due to upbeat air-travel demand. The year-over-year increase in the top line was driven by a 20.1% rise in passenger revenues (accounting for 91.7% of the top line) to $13,002 million. Nearly 42 million passengers traveled on UAL flights in the second quarter.
Cargo revenues fell 36.9% year over year to $362 million. Revenues from other sources increased 14.8% from the second quarter of 2022 to $814 million.
United Airlines Holdings Inc Price, Consensus and EPS Surprise
Below, we present all comparisons (in % terms) with the second quarter of 2022 figures unless otherwise stated.
Consolidated passenger revenue per available seat mile (a key measure of unit revenues) increased 2.2%. Total revenue per available seat mile fell 0.4% to 19.28 cents. The average yield per revenue passenger mile increased 2.6% to 20.46 cents.
Consolidated airline traffic, measured in revenue passenger miles, grew 17%, while capacity, measured in available seat miles, grew 17.5%. Consolidated load factor (percentage of seat occupancy) inched down 0.3 percentage points to 86.4%, higher than our estimate of 81.4%.
The average aircraft fuel price per gallon fell 36.4% to $2.66, lower than our expectation of $2.83. Fuel gallons consumed were up 16.4% from the second quarter of 2022 actuals.
Operating expenses (on a reported basis) increased 12.7% to $12,661 million. Consolidated unit cost or cost per available seat mile (CASM), excluding fuel, third-party business expenses, profit-sharing and special charges, grew 2% to 11.85 cents.
UAL exited the second quarter with cash and cash equivalents of $9,605 million compared with $7,634 million at the end of the prior quarter. Long-term debt at the end of the reported quarter was $26,713 million compared with $27,460 million at the end of the prior quarter.
Outlook
For the third quarter of 2023, United Airlines expects capacity to improve by almost 16% from the year-ago reported figure.
Total revenues are anticipated to grow 10-13% year over year. UAL expects third-quarter EPS in the band of $3.85-$4.35. The Zacks Consensus Estimate for third-quarter EPS is currently pegged at $3.61.
UAL forecasts the average aircraft fuel price per gallon in the range of $2.50-$2.80.
For 2023, United Airlines expects capacity to improve by almost 18% from the year-ago reported figure. Adjusted CASM, excluding fuel, third-party business expenses, profit-sharing and special charges, is expected to register year-over-year growth of 1%-2% (prior view: remain flat). Adjusted capital expenditures are expected to be around $8.5 billion.
UAL expects 2023 EPS in the band of $11.00-$12.00 (prior view: $10-$12). The Zacks Consensus Estimate for 2023 EPS is currently pegged at $9.79.
J.B. Hunt Transport Services, Inc.’s (JBHT - Free Report) second-quarter 2023 EPS of $1.81 missed the Zacks Consensus Estimate of $1.97 and declined 25.2% year over year.
JBHT’s total operating revenues of $3,132.6 million also lagged the Zacks Consensus Estimate of $3,347.5 million and fell 18.4% year over year. The downfall was due to a decline in revenue per load of 24% in Integrated Capacity Solutions, 13% in Intermodal, 21% in Truckload and a 4% decline in productivity in Dedicated Capacity Solutions on the back of changes in customer rate, freight mix and lower fuel surcharge revenue.
Total operating revenues, excluding fuel surcharges, decreased 14% year over year.
Delta Air Lines (DAL - Free Report) reported better-than-expected revenues and EPS, driven by strong air-travel demand. DAL’s second-quarter 2023 EPS (excluding 16 cents from non-recurring items) of $2.68 comfortably beat the Zacks Consensus Estimate of $2.42. DAL reported EPS of $1.44 a year ago, dull compared to the current scenario, as air-travel demand was not so buoyant then.
DAL’s total revenues of $15,578 million beat the Zacks Consensus Estimate of $14,991.6 million. Total revenues increased 12.69% on a year-over-year basis, driven by higher air-travel demand.
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United Airlines (UAL) Tops Q2 Earnings & Revenues, Ups EPS View
United Airlines Holdings, Inc. (UAL - Free Report) reported second-quarter 2023 earnings per share (EPS) of $5.03, which outpaced the Zacks Consensus Estimate of $3.99 and improved more than 100% year over year.
Operating revenues of $14,178 million beat the Zacks Consensus Estimate of $13,927.1 million. UAL’s revenues increased 17.1% year over year due to upbeat air-travel demand. The year-over-year increase in the top line was driven by a 20.1% rise in passenger revenues (accounting for 91.7% of the top line) to $13,002 million. Nearly 42 million passengers traveled on UAL flights in the second quarter.
Cargo revenues fell 36.9% year over year to $362 million. Revenues from other sources increased 14.8% from the second quarter of 2022 to $814 million.
United Airlines Holdings Inc Price, Consensus and EPS Surprise
United Airlines Holdings Inc price-consensus-eps-surprise-chart | United Airlines Holdings Inc Quote
Other Details of Q2
Below, we present all comparisons (in % terms) with the second quarter of 2022 figures unless otherwise stated.
Consolidated passenger revenue per available seat mile (a key measure of unit revenues) increased 2.2%. Total revenue per available seat mile fell 0.4% to 19.28 cents. The average yield per revenue passenger mile increased 2.6% to 20.46 cents.
Consolidated airline traffic, measured in revenue passenger miles, grew 17%, while capacity, measured in available seat miles, grew 17.5%. Consolidated load factor (percentage of seat occupancy) inched down 0.3 percentage points to 86.4%, higher than our estimate of 81.4%.
The average aircraft fuel price per gallon fell 36.4% to $2.66, lower than our expectation of $2.83. Fuel gallons consumed were up 16.4% from the second quarter of 2022 actuals.
Operating expenses (on a reported basis) increased 12.7% to $12,661 million. Consolidated unit cost or cost per available seat mile (CASM), excluding fuel, third-party business expenses, profit-sharing and special charges, grew 2% to 11.85 cents.
UAL exited the second quarter with cash and cash equivalents of $9,605 million compared with $7,634 million at the end of the prior quarter. Long-term debt at the end of the reported quarter was $26,713 million compared with $27,460 million at the end of the prior quarter.
Outlook
For the third quarter of 2023, United Airlines expects capacity to improve by almost 16% from the year-ago reported figure.
Total revenues are anticipated to grow 10-13% year over year. UAL expects third-quarter EPS in the band of $3.85-$4.35. The Zacks Consensus Estimate for third-quarter EPS is currently pegged at $3.61.
UAL forecasts the average aircraft fuel price per gallon in the range of $2.50-$2.80.
For 2023, United Airlines expects capacity to improve by almost 18% from the year-ago reported figure. Adjusted CASM, excluding fuel, third-party business expenses, profit-sharing and special charges, is expected to register year-over-year growth of 1%-2% (prior view: remain flat). Adjusted capital expenditures are expected to be around $8.5 billion.
UAL expects 2023 EPS in the band of $11.00-$12.00 (prior view: $10-$12). The Zacks Consensus Estimate for 2023 EPS is currently pegged at $9.79.
Currently, United Airlines carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performances of Other Transportation Companies
J.B. Hunt Transport Services, Inc.’s (JBHT - Free Report) second-quarter 2023 EPS of $1.81 missed the Zacks Consensus Estimate of $1.97 and declined 25.2% year over year.
JBHT’s total operating revenues of $3,132.6 million also lagged the Zacks Consensus Estimate of $3,347.5 million and fell 18.4% year over year. The downfall was due to a decline in revenue per load of 24% in Integrated Capacity Solutions, 13% in Intermodal, 21% in Truckload and a 4% decline in productivity in Dedicated Capacity Solutions on the back of changes in customer rate, freight mix and lower fuel surcharge revenue.
Total operating revenues, excluding fuel surcharges, decreased 14% year over year.
Delta Air Lines (DAL - Free Report) reported better-than-expected revenues and EPS, driven by strong air-travel demand. DAL’s second-quarter 2023 EPS (excluding 16 cents from non-recurring items) of $2.68 comfortably beat the Zacks Consensus Estimate of $2.42. DAL reported EPS of $1.44 a year ago, dull compared to the current scenario, as air-travel demand was not so buoyant then.
DAL’s total revenues of $15,578 million beat the Zacks Consensus Estimate of $14,991.6 million. Total revenues increased 12.69% on a year-over-year basis, driven by higher air-travel demand.