American Airlines Flies Into Uncertainty: Q1 Revenue Miss, 2025 Outlook Pulled, But Debt Plan On Track

American Airlines Group Inc. AAL stock is trading lower on Thursday after it reported mixed first-quarter 2025 results and withdrew its full-year outlook.

The airline’s operating revenue declined slightly to $12.55 billion (down 0.15% year-over-year), missing the consensus of $12.36 billion. Total unit revenue rose 0.7% year-over-year, driven by strong international performance.

The airline continued rebuilding revenue from indirect channels and remains on track to return to historical levels by year-end. However, progress was offset by economic uncertainty and the impact of the American Eagle Flight 5342 accident.

Related: American Airlines Gears Up For Q1 Print; Here Are The Recent Forecast Changes From Wall Street’s Most Accurate Analysts

The adjusted operating margin was negative at 1.6%, compared to 0.6% a year ago. The company reported an adjusted loss per share of $(0.59), down from $(0.34) a year ago but above the consensus of $(0.65).

The company generated an operating cash flow of $2.456 billion for the quarter, up from $2.18 billion a year ago, and a free cash flow of ~$1.711 billion.

American cut total debt by $1.2 billion in the quarter, bringing reductions since 2021 to $16.6 billion. It aims to lower debt below $35 billion by 2027 and ended the quarter with $10.8 billion in liquidity, plus over $23 billion in borrowing capacity.

The first quarter’s revenue passenger miles declined by 1.9%. Available seat miles were down by 0.9%, and the passenger load factor was 80.6% compared to 81.5% in the same quarter last year.

The average aircraft fuel price, including related taxes (dollars per gallon), fell 13.3% YoY to $2.48, and the operating cost per ASM rose by 2.9%.

Also Read: Airline Earnings At Risk As Demand Dips Amid Weak Business Travel, Low Transborder Traffic, DOGE Cuts: Analyst Says

American and Citi are progressing toward their expanded AAdvantage partnership, which is set to launch in 2026. In Q1, AAdvantage enrollments rose 6%, and co-branded card spending grew 8%, reflecting strong loyalty program engagement.

Q2 Outlook: Based on current demand and fuel trends, American Airlines expects adjusted EPS between $0.50 and $1.00 versus the consensus of $0.99.

Full-year 2025 guidance has been withdrawn, with an update planned once economic conditions stabilize.

“The actions American has taken over the past several years to refresh our fleet, manage costs and strengthen our balance sheet position us well for the uncertainty our industry is facing,” stated American’s CEO Robert Isom.

“The resiliency of the American Airlines team, combined with the investments we have made to differentiate our network, product and customer experience, give us extreme confidence in our ability to navigate the current environment and deliver strong results for the long term,” he added.

Price Action: AAL shares are trading 0.64% lower at $9.26 in the premarket as of the last check on Thursday.

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