JetBlue Sees More Post-Election Travel Than Expected
Skift Take
Key Points
- JetBlue has increased its revenue guidance for the year due to higher than expected bookings post-U.S. presidential election.
- The airline's 'JetForward' strategy aims to restore profitability through route cuts, deferred aircraft deliveries, and a focus on leisure routes.
- JetBlue reported a $60 million net loss in the third quarter, influenced by excess domestic capacity impacting U.S. airline profits.
Summary
JetBlue has revised its annual revenue guidance upward following stronger than anticipated bookings after the U.S. presidential election. The airline's 'JetForward' strategy, which includes cutting unprofitable routes and focusing on leisure travel, is expected to yield $300 million in benefits for the fourth quarter. Despite this, JetBlue reported a $60 million net loss in the third quarter, partly due to an industry-wide domestic capacity surplus affecting profitability.
JetBlue raised its revenue guidance for the year after bookings in November and December were higher than expected following the U.S. presidential election.
The carrier said on Wednesday it is now forecasting the election to impact revenues by 0.5 percentage points instead of one percentage point.
JetBlue added that improved demand and strong operational performance during Thanksgiving led to better revenue performance for the November holiday peak. For December, bookings are also exceeding prior projections for both peak and off-peak periods.
Revenues for the year are expected to be down 3.5% to 4.5% rather than the 4% to 5% JetBlue previously forecast. Fourth-quarter revenues are now expected to be down 2% to 5% instead of the previously estimated 3% to 5%, JetBlue said.
Executives at JetBlue have been confident about the carrier’s ability to restore its profitability through its “JetForward” program, which has included cutting routes in unprofitable areas, deferring aircraft deliveries, and focusing on more leisure routes out of New York and Boston.
JetBlue is projecting that the initiatives from this strategy will bring in about $300 million of “cumulative benefit” for the fourth quarter.
During the third quarter, JetBlue reported a net loss of $60 million as the industry has grappled with a glut of domestic capacity that has impacted the profits of major U.S. airlines.
Watch JetBlue President, Marty St. George, at the Skift Aviation Forum 2024:
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Photo Caption: A JetBlue Airbus A321neo aircraft. JetBlue JetBlue
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