United Airlines?reported solid first-quarter earnings this week, despite a challenging economic climate that is negatively impacting many travel companies.?
The Chicago-based airline posted its best first-quarter results in five years, with a record revenue of $13.2 billion.
Executives said on a Wednesday earnings call that they expect to be one of only two US airlines that are profitable in the first quarter of 2025. A host of economic headwindslike?escalating tariffs?and customers wary of an impending recessionhave been buffeting the US travel industry, but the airline said its strong brand loyalty among customers is helping it weather the storm.
United has won brand loyal customers, and they are sticky, lifelong customers, the airlines CEO, Scott Kirby, said on the earnings call. We are now the brand-loyal leader by a wide margin in six of our seven hubs, and tied with one other airline in Los Angeles. It is those gains that are allowing us to be resilient, even in this weaker economic environment.
New products launching later this year could help maintain and build that valuable loyalty from travelers. Passengers can look forward to United rolling out high-speed Starlink Wi-Fi later this springan amenity that executives said they expect will revolutionize the in-flight experience"as well as new United clubs in Houston, San Francisco, and Denver. Were capitalizing on our momentum and doing more to attract even more brand-loyal customers, Kirby said.
The executive team also noted that the airline doesnt currently anticipate that new tariffs on aircraft purchases will have a meaningful impact on the airlines bottom line: Most of Uniteds planes on order are from Boeing, and its Airbus A321neos are produced in Alabama.
Operationally, the carrier also made notable improvements in the first quarter. The airline said that in Q1 2025, it served more customers than ever for a first quarter, plus it achieved its best?on-time arrival?score since the pandemic and its second-lowest seat cancellation rate in company history.
Some of the challenges United faced in the current environment included declining demand for domestic flights in its Main Cabin, as well as slightly softening demand from international flights originating overseas. Demand for flights with points of origin in Europe dropped by six percent year-over-year for the first quarter, while demand for flights originating in Canada decreased by nine percent.?
However, those headwinds were balanced by an uptick in demand for premium seats, which jumped 9.2 percent in the first quarter, as well as strong, US-based demand for international travel. Revenue per available seat mile (RASM) for flights across the Atlantic and Pacific was up 4.7 percent and 8.5 percent, respectively. Executives noted that?Japan?has been a phenomenally strong market for US travelers, and that demand to the South Pacific has been having a very good year. Additionally, the airline has been seeing that Southern Europe is an increasingly desirable vacation spot for US consumers.?
And the good financial results dont mean United is slowing down. Looking ahead to later this year, executives said there are still a lot of things in the hopper that we havent announced that are yet to come."
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