United Airlines offers an upbeat outlook on improved pricing power

UNITED Airlines on Tuesday forecast a stronger-than-expected profit in the current quarter, after its earnings topped Wall Street estimates in the fourth quarter on robust travel demand and improved pricing power.

The Chicago-based airline’s shares were up about 4 per cent in after-hours trading.

United said it is witnessing a strong and broad-based demand for travel across all geographies.

In the December quarter, sales of its premium and basic economy seats were up 10 per cent and 20 per cent year-on-year, respectively. Corporate bookings rose 7 per cent from a year ago.

The company said accelerating demand trends have put it on the path to double-digit pre-tax margins in 2025, up from 7.3 per cent a year ago.

United and rival US carriers are also benefiting from a sharp reduction in airline seats in the domestic market, which has driven up ticket prices and bolstered the industry’s earnings outlook.

Airline fares rose at their fastest pace in 21 months in December on a combination of a limited supply of seats and strong holiday travel demand.

United’s total revenue per available seat mile, a proxy for pricing power, was up 1.6 per cent year-on-year in the December quarter. It expects further improvements in pricing power in the current quarter.

Earlier this month, rival Delta Air Lines termed the industry’s capacity discipline a “constructive” backdrop, which is expected to help produce a record profit for the company in 2025.

SEE ALSO

Asean carbon market might face setbacks with Trump back in power

Comac jets for Vietnam show China’s push for international market

China’s Comac aims to lift C919 jet production capacity to 50 this year: report

Private jet travel demand tapers in Singapore but remains above pre-pandemic levels

Bird feathers, blood found in both engines of crashed jet in South Korea: source

SIA, Scoot clock monthly record in passengers in December

More

United expects an adjusted profit in the range of 75 cents a share to US$1.25 per share in the quarter through March. Analysts expect the company to report a quarterly profit of 54 cents a share, according to LSEG data.

For the full-year 2025, United forecast an adjusted profit of US$11.50 to US$13.50 per share. That compares with US$12.85 per share expected by Wall Street analysts.

Its adjusted earnings in the December quarter came in at US$3.26 a share, compared with analysts’ expectations of US$3.00.

United will discuss its financial results on a call with analysts and investors on Wednesday morning. REUTERS