American Airlines Group Inc. reported higher-than-expected revenue and profit for Q4, but warned of a loss in Q1.

American Airlines Group Inc. (AAL.US) announced its financial performance for the fourth quarter and full year of 2024. The financial report shows that the company's fourth quarter revenue reached $13.66 billion, a 4.6% increase compared to the previous year, exceeding market expectations of $13.4 billion. In the fourth quarter, American Airlines Group Inc. saw its net profit increase to $590 million, a significant rise from $19 million in the same period last year. Adjusted earnings per share were $0.86, higher than the analyst average expectation of $0.65. Looking at the full year, American Airlines Group Inc. achieved revenue of $54.2 billion in 2024, with a net profit of $846 million and diluted earnings per share of $1.24. It is understood that the growth in the fourth quarter of American Airlines Group Inc. was mainly driven by the company's capacity adjustments and sustained strong market demand. In this quarter, American Airlines Group Inc.'s domestic, Atlantic, Pacific routes, and overall passenger unit revenue all outperformed other network operators in the United States. However, looking ahead, American Airlines Group Inc. expects to incur unexpected losses in the first quarter of 2025, in stark contrast to other competitors who have been taking advantage of strong winter demand and high domestic ticket prices. American Airlines Group Inc. expects an adjusted loss per share of $0.40 in the first quarter of 2025, while Bloomberg estimates the analyst average expectation to be earnings of $0.01 per share. Data from the London Stock Exchange shows that based on current demand trends and forecasted fuel prices, American Airlines Group Inc. anticipates an adjusted loss per share of between $0.20 and $0.40 for the first quarter of 2025, higher than the analyst expectation of $0.04. Additionally, the company forecasts that unit costs (excluding fuel) for the first quarter of 2025 will increase by low single-digit percentages due to a decrease in capacity, which is expected to be 2% lower than the same period last year. Meanwhile, competitors United Airlines and Delta Air Lines, Inc. have a more optimistic outlook. They point out that there is strong demand for travel to Europe during the winter, and domestic ticket prices are also rising. In comparison, American Airlines Group Inc. faces greater risks of ticket price increases due to its extensive domestic network and sunny destinations, as major airlines reduced unprofitable flights last year to reduce excess seating. This setback is particularly disadvantageous for American Airlines Group Inc. Over the past few months, the company has been trying to regain the business customers it lost last year. Previously, the company abandoned the practice of encouraging corporate customers to book directly instead of through third-party travel managers, resulting in a loss of $1.5 billion. Progress in regaining business travel business has been slow for American Airlines Group Inc. In the fourth quarter, its share of revenue from business travel decreased by 9% year-on-year. The company expects to increase this by 2 percentage points this quarter and aims to fully recover its share of indirect booking revenue by the end of this year. As of the time of writing, American Airlines Group Inc. has fallen more than 8% in pre-market trading, to $17.12.