American Airlines withdraws 2025 forecast on murky economic outlook

American Airlines withdrew its 2025 financial guidance on Thursday, joining other carriers that are grappling with an uncertain outlook for the U.S. economy and weaker-than-expected leisure travel bookings this year.

“We came off a strong fourth quarter, saw decent business in January and really domestic leisure travel fell off considerably as we went into the February time frame,” CEO Robert Isom told CNBC’s “Squawk Box” on Thursday.

American said that the 0.7% increase in unit revenue in the first quarter was driven by strength in international bookings and premium cabins, echoing other airlines like Delta and United, which said more price-sensitive leisure customers have been the ones holding back on trips.

The airline forecast second-quarter revenue down as much as 2% from last year to up as much as 1%, below the 2.2% Wall Street analysts expected, with its capacity expected to rise as much as 4% in the current quarter. American said adjusted per-share earnings would likely come in between 50 cents and $1, while analysts expected 99 cents per share.

It said capacity will rise between 2% and 4% over last year in the second quarter.

Here is how American performed in the first quarter compared with Wall Street estimates compiled by LSEG:

• Loss per share: 59 cents adjusted vs. an expected loss of 65 cents
• Revenue: $12.55 billion vs. $12.6 billion expected

American posted a $473 million loss for the first quarter, wider than the $312 million loss it reported a year earlier, with revenue of $12.55 billion, nearly unchanged from last year. Adjusting for one-time items, American reported a loss per share of 59 cents.

Capacity was down 0.8%.

American said its efforts to rebuild its corporate travel business after a failed business strategy are making progress but were offset by “economic uncertainty that pressured domestic leisure demand and the tragic accident of American Eagle Flight 5342,” referring to the January accident when an Army helicopter collided with an American regional jet that was landing in Washington, D.C., killing all 67 people on the two aircraft.