+

Cookies on the Business Insider India website

Business Insider India has updated its Privacy and Cookie policy. We use cookies to ensure that we give you the better experience on our website. If you continue without changing your settings, we\'ll assume that you are happy to receive all cookies on the Business Insider India website. However, you can change your cookie setting at any time by clicking on our Cookie Policy at any time. You can also see our Privacy Policy.

Close
HomeQuizzoneWhatsappShare Flash Reads
 

Shifting Gears: Airlines are losing money. Lots of it.

Apr 24, 2020, 22:15 IST
Business Insider
Air travelers grab carry-on luggage behind rows of empty seats aboard a Delta flight, as coronavirus disease (COVID-19) disruption continues across the global industry, from New York's JFK International Airport to San Francisco, California, U.S., March 17, 2020.REUTERS/Shannon Stapleton

Airlines aren't used to losing money.

Advertisement

For years, the core group of US airlines raked in hundreds of millions of dollars in pure profit, which they spent freely on stock buybacks and service expansions. American Airlines, the largest domestic carrier, for instance, saw profits increase from $690 million in 2012 to $2.179 billion in 2019.

That is, until it all came crashing down.

Delta was the first airline to report its first quarter earnings this week, and things aren't looking good. It expects to lose $534 million for the three-month period, of which only the latter half was fully affected by the absolute plunge in travel.

The other airlines are set to report in the coming week — but don't expect things to get much better. United forecast in a surprise release that it would likely lose $2.1 billion for the quarter as revenues fall 90%.

Advertisement

So when will things get better? Your guess is as good as mine. As it stands now, nearly three quarters of Americans say they won't fly for at least four months, according to a Fortune-SurveyMonkey poll. Adios, summer vacation plans…

(Don't forget, you can sign up here to get this newsletter straight to your inbox.)

Here's what else happened this week:

Read the original article on Business Insider
You are subscribed to notifications!
Looks like you've blocked notifications!
Next Article