American Airlines Records 37% Revenue Growth In Q1, Guides Q2 EPS Above Consensus, Reaffirms FY23 Guidance

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  • American Airlines Group Inc AAL reported first-quarter FY23 operating revenue growth of 37% year-over-year to $12.19 billion, marginally missing the consensus of $12.20 billion.
  • AAL's Q1 adjusted EPS was $0.05, in line with the consensus of $0.05.
  • Passenger revenues rose 42% Y/Y to $11.1 billion, and cargo revenues declined 38.7% to $223 million.
  • Q1 Operating expenses increased by 10.6% Y/Y to $11.75 billion.
  • The airlines reported an operating income of $438 million, compared to a loss of $(1.72) billion a year ago, and the operating margin was 3.7% on an adjusted basis.
  • Passenger load factor was 80%, up from 74.4% in 1Q22. Revenue passenger miles increased by 17.4% Y/Y, and ASM increased by 9.2% Y/Y.
  • Also Read: Delta Trades Higher Following American Air Lines Q1 Print: The Bull, Bear Case
  • Average aircraft fuel price per gallon, including related taxes, was $3.28 vs. $2.80 in 1Q22.
  • American Airlines' net cash provided by operating activities for Q1 totaled $3.33 billion, compared to $1.18 billion a year ago.
  • American Airlines ended the quarter with ~$14.4 billion of total available liquidity. It reduced total debt by more than $850 million in the quarter.
  • The company states that the demand for American products remains strong. Domestic and short-haul international revenue continues to perform well, and the airline has seen noticeable strength in long-haul international demand and yield performance this year.
  • 2Q23 Guidance: AAL expects Adjusted EPS of $1.20-$1.40, versus consensus of $1.06.
  • FY23 Guidance reaffirmed: American Airlines sees FY23 Adjusted EPS of $2.50-$3.50, versus consensus of $2.35.
  • Price Action: AAL shares traded higher by 2.36% at $13.04 on the last check Thursday.
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