A United Airlines passenger jet takes off from Newark Liberty International Airport, on Dec. 6, 2019.CHRIS HELGREN/Reuters
United Airlines Holdings Inc on Tuesday forecast a smaller fall in second-quarter unit revenue and core margins, and said it expects domestic leisure yields for summer travel to exceed 2019 levels.
Airlines are seeing a pick up in summer bookings as easing COVID-19 restrictions and widespread vaccination efforts encourage travel in the United States, nearly a year after the pandemic hit demand.
United said ticketed yields accelerated in the second quarter, but warned that capacity for the same period would fall at least 46 per cent compared to 2019, hurt by fewer flights to India and Israel during the health crisis.
The U.S. airline had previously expected second-quarter capacity to be down about 45 per cent.
“Business demand continues to be significantly depressed, though bookings for business travel are starting to recover,” United said.
The carrier expects total revenue per available seat mile (TRASM), or unit revenue, to be down about 12 per cent in the second quarter from 2019, compared to its prior outlook of down about 20 per cent.
United expects adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) margin in the quarter to be down 11 per cent, compared to its prior forecast of down 20 per cent.
Southwest Airlines last week trimmed its second-quarter average core cash burn forecast, as improving demand for leisure travel is expected to more than offset higher fuel prices.
Be smart with your money. Get the latest investing insights delivered right to your inbox three times a week, with the Globe Investor newsletter. Sign up today.