Southwest and JetBlue expect higher revenue in second quarter as travel booms

The rebound in travel is shaping up to be even stronger than expected by airlines, helping to offset rising fuel prices. Southwest Airlines and JetBlue Airways said Thursday their second-quarter revenue was on track to be higher than the carriers had expected.

The announcements are the latest sign that people are increasingly planning leisure and business trips despite a rise in coronavirus cases across the country. Many travelers also seem indifferent to the high prices of tickets, hotel rooms and rental cars. Flights booked in the United States for this weekend cost an average of $394, up 28% from the same weekend in 2019, according to Hopper, a travel booking app.

Southwest said in a securities filing that it expects April-June revenue to rise 12 to 15 percent from the same period in 2019, versus a previous projection of an 8 percent increase. at 12%. And while fuel prices are expected to be 5 to 11% higher than expected, higher revenues will “more offset” this cost increase, the airline said. Based on current trends, Southwest said it “expects strong earnings and operating margins” for the second quarter and the remainder of the year.

JetBlue also said business is improving and it is on track to collect record revenue this summer. Ticket bookings are beating the airline’s expectations, with revenue for the current quarter expected to be “at or above” the upper bound of its previous estimate. Revenue per seat per mile flown is expected to be more than 20% higher than in the second quarter of 2019, the airline said.

United Airlines issued a similar update last week. The company said revenue per seat per mile is expected to increase 23-25% in the second quarter compared to the same period in 2019. United had previously forecast a 17% increase.

Last month, United chief executive Scott Kirby described flight demand as “the strongest in my 30 years in the industry”.

In the first half of May, consumers spent about $4 billion on domestic flights, up 5% from the second half of April, according to recent analysis by the Adobe Digital Economy Index. , which tracks the online sales of six of the top 10. American airlines. Reservations increased by 2% between the last 15 days of April and the first 15 days of May. Sales and spending increased in May, compared to a similar period in 2019, according to the analysis.

Delta Air Lines said Thursday it expects to fly 2.5 million passengers over Memorial Day weekend, up 25% from the same weekend last year, but still below the 2.8 million people carried in the same weekend in 2019. The company also said it would reduce flights this summer in a bid to avoid flight delays and cancellations that have plagued airlines last year.

Inclement weather, air traffic control disruptions, understaffed vendors and coronavirus quarantines have resulted in “an operation that is not always up to the standards set by Delta,” said Allison Ausband, chief operating officer. airline customer experience, in a statement. Delta plans to cut about 100 daily flights from July through the first week of August, a 2% reduction in its schedule.

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