JetBlue Airways It suffered a loss in the fourth quarter and forecast lower capacity this year as it struggles to return to profitability.
The airline expects revenue to fall between 5% and 9% in the first three months of the year, more than the 5.5% drop that Wall Street analysts predicted. Capacity in the first quarter will be reduced by up to 6%, the airline said.
JetBlue said it expects 2024 capacity to decline in the low single digits and its tight margins could approach breakeven. Its shares fell more than 1% in morning trading.
The airline has been grappling with higher costs, operational challenges and changing travel patterns, just as a federal judge earlier this month barred its plan to acquire Spiritual airlines for 3.8 billion dollars. JetBlue warned last week that the deal with Spirit could be terminated, but did not provide further details in Tuesday's filing.
JetBlue said Tuesday that it plans to defer $2.5 billion in spending on new planes until the end of the decade. In an investor presentation, JetBlue said it has seven Airbus planes out of service for engine inspections due to a production issue at manufacturer Pratt & Whitney. He said the number could rise to 15 by the end of the year.
Here's what JetBlue reported for the fourth quarter, compared to Wall Street expectations met by LSEG, formerly known as Refinitiv:
- Adjusted loss per share: 19 cents vs. 28 cents expected
- Revenue: $2.33 billion vs. $2.29 billion expected
The New York-based airline reported a net loss of $104 million for the final three months of 2023, compared with a profit of $24 million a year earlier. On a per-share basis, JetBlue lost 31 cents during the fourth quarter, or 19 cents on an adjusted basis, compared with a profit of 7 cents during the same period a year earlier.
Fourth-quarter revenue declined 3.7% year over year, although still slightly above Wall Street estimates.
JetBlue has been adjusting its network to focus on more profitable flights. CNBC reported on JetBlue's planned flight cuts earlier this month.
“Demand during peak periods remains strong and we continue to manage our capacity during off-peak periods to reflect changing demand trends,” Joanna Geraghty, JetBlue's incoming chief operating officer and CEO, said in a statement. “We plan to continue refining our network and product offering to better serve our leisure customers while diversifying revenue with initiatives that increase margins.”
Other airlines including South west They have also slowed their growth or refined their networks to avoid excess capacity (and low fares) during off-peak periods, while also offering discounts on less popular flights.
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