Fort Worth, Texas-based American Airlines says its new sales strategy has been paying off.
American reported expectations to earn between 25 cents and 50 cents a share on an adjusted basis for the last quarter of 2024. For the full year, the airline expects to earn as much as an adjusted $1.60 a share, ahead of an earlier American forecast for no more than $1.30 a share. American also reported a third-quarter revenue of $13.6 billion and a net loss of $149 million.
“We did some damage to ourselves with our sales distribution strategy, but I’m really pleased with what I see in terms of recovery of that,” Robert Isom, CEO of American told investors on Thursday’s earnings call.
In May, the company announced Vasu Raja, American’s former chief commercial officer was let go after a sales strategy he had implemented produced lackluster results. At the time, the move cut discounts tied to its contracts with corporate travel agencies and clients and ultimately backfired.
In the third quarter, the airline said it renegotiated those contracts with a majority of the largest travel agencies and many of its top corporate customers. The company reintroduced corporate experience benefits for corporate travelers and increased support for corporate and agency customers by adding sales account managers and sales support staff.
Researchers at Raymond James called American’s revenue outlook “disappointing.”
“Notably, the revenue outlook is disappointing, albeit the fuel guide could be conservative,” researchers wrote. “It is unclear if Hurricane Milton, not included in our forecast and likely not in consensus, had a meaningful impact in the quarter.”
In the third quarter, American reported $12.5 billion in passenger revenue, $202 million from cargo and $922 million in other revenues, inclusive of the AAdvantage affinity card program.
“I’m very optimistic about our future,” Isom said.
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