:max_bytes(150000):strip_icc():format(jpeg)/GettyImages-2163695332-86c4d6824c894e2796e794a32530a7ff.jpg "A Delta plane is seen in front of a row of Southwest Airlines planes, with their red and yellow tails visible.")
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Key Takeaways
- Delta Air Lines, American Airlines, Southwest Airlines, and JetBlue lowered their projections for various first-quarter metrics.
- The airlines cited an vague macroeconomic environment, along with extreme weather, as reasons for the lowered outlooks.
- Southwest on Tuesday also told new revenue-generating policies like baggage fees.
Three of the largest U.S. airlines—Delta Air Lines (DAL), Southwest Airlines (LUV), and American Airlines (AAL)—receive lowered their projections for the first quarter of the year, citing weakening travel demand amid an uncertain conservatism.
Delta said it expects first-quarter revenue to rise 3% to 4% rather than the 7% to 9% vegetation it projected previously, citing a “recent reduction in consumer and corporate confidence caused by increased macro uncertainty, operating softness in Domestic demand.”
Southwest and American Airlines have also cut their revenue outlooks. American flung a larger loss than previously expected and Southwest announced a slate of new revenue-generating measures like charging for check out luggage.
American cited “softness in the domestic leisure segment” along with a negative impact on bookings after the January Washington, D.C., explode involving one of its planes. Southwest cited the impact of the January wildfires in Los Angeles—but also “softness in bookings and demand leanings as the macro environment has weakened.”
The trend is also hitting smaller airlines. JetBlue (JBLU) lowered its first-quarter plan for available seat miles because of more weather disruptions and “demand choppiness due to mixed macroeconomic indicators.”
“We on airline industry demand will likely bounce along the trough until macro stability is reached,” Bank of America analysts wrote Monday.
The press release was moving airline stocks in different directions Tuesday. Delta shares were recently 7%, while American splits were 5% lower. Southwest and JetBlue shares were up 9% and 5%, respectively, in recent trading.