American Airlines, the publicly traded carrier, reportedly anticipates earning a profit in the December quarter that is higher than Wall Street projections, thanks to a solid recovery in travel demand that shows no signs of abating despite rising airfare.

Due to the reopening of borders and the strengthening of the currency, major U.S. airlines are hopeful that the rebound trends will continue.

Office reopening also increased corporate travel, which has been recovering slowly.

In premarket trading, American Airlines' stock was up roughly 3% at $14.43.

As per Refinitiv IBES data, compared to analysts' expectations of 22 cents per share for Q4 ending in December, the carrier stated it anticipated adjusted profit from 50 to 70 cents per share.

For the quarter that ended on September 30, American Airlines posted an adjusted profit of $478 million, or 69 cents a share, as opposed to an effective loss of $641 million, or 99 cents a share, a year earlier.

Operating revenue for the airline situated in Fort Worth, Texas, increased from roughly $8.97 billion to around $13.46 billion in the previous year.

Due to robust bookings and rates, rivals United Airlines and Delta Air Lines also forecast that they would remain profitable until the end of the year.

The travel sector now has strong demands with customers continuing to travel and often paying more fares than they did in 2019. In comparison to the pre-pandemic period, all three main airlines have posted higher revenues, a trend that is assisting them in more than offsetting an increase in expenses.

The cost of fuel in America quadrupled from the previous year to over $3.8 billion, while the cost of labor increased by 12% to $3.4 billion.

The airline also projected that its expenses per seat available mile will probably increase 8% to 10% in the final three months of the year compared to the same period in 2019 and up to 13% for the entire year when compared to the data from 2019.

Source credit: https://www.foxbusiness.com/markets/american-airlines-forecasts-strong-profit-december-quarter

https://www.cnbc.com/2022/10/20/american-airlines-aal-3q-2022.html