United Airlines reported its earnings on Wednesday after the markets closed. The company announced that revenue for the most recent quarter was $15 billion, marking a 5.7% increase from the same period last year. Net income reached $1.3 billion, up 23% compared to the previous year. However, these positive results were somewhat dampened by concerns about declining demand highlighted in the release.
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“For nearly two years, the airline has been anticipating significant domestic capacity reductions recently announced by various U.S. airlines this summer, and mid-August marks an inflection point, with published schedule changes indicating approximately a 3-point decline in industry capacity growth rate,” the statement accompanying the earnings report said.
United’s capacity, referred to as “available seat miles,” increased by 8.3% from the same quarter in 2023. Despite this, the airline reported that its planes were slightly less full during this period. The load factor, which measures the number of revenue-generating passenger miles flown divided by the number of available seat miles, decreased to 84.2% from 86.4%.
Similar to Delta Air Lines, United anticipates that its premium passengers flying first and business class, along with growth in the budget airfare segment, will help mitigate any industry-wide downturns.
“The revenue diversity advantages that we’ve built with our premium customers, Basic Economy customers, and domestic road warriors, combined with the world’s best loyalty program and leading customer service, have propelled our margins to near the top of the industry,” said CEO Scott Kirby.