On Wednesday, United Airlines reported a rebound in travel demand since early July, attributing this shift to decreased geopolitical and economic uncertainties.
Despite this, the airline anticipates revenue challenges this quarter, primarily due to operational issues at Newark Airport, which is close to New York City.
During the last quarter, United saw a 6% rise in overall travel demand for the third quarter and noted a significant increase in business bookings.
As a consequence, the airline estimates adjusted earnings of $11 per share for the year, with a range from $9 per share, which trails behind analysts’ expectations of $10.04 per share.
“I think the world feels a bit less uncertain than it did in the first half of 2025, and that gives us some confidence for a strong finish this year,” said United CEO Scott Kirby in a statement.
However, United’s stock dipped by 1.6% in after-hours trading since the third-quarter earnings projections fell short of Wall Street forecasts.
The airline anticipates adjusted earnings of about $2.25 per share for the upcoming quarter, while analysts expect it to be around $2.50, slightly lower than initial estimations.
Operational issues at Newark are projected to impact earnings by 0.9% this quarter, in contrast to a 1.2% impact seen in the second quarter.
In April, United had even provided two different revenue forecasts due to uncertainties stemming from President Trump’s trade policies, which have made it challenging for airlines to predict their performance.
Weak Pricing Power
Since then, executives in the industry have noticed a stabilization in travel demand. Yet, US passenger traffic has been on a decline for a year, which has led to falling airfares, according to government data.
With better booking trends, last week allowed competitor Delta Air Lines to revise its profit expectations for the full year.
Nonetheless, a recent revenue report indicates that airlines are still grappling with their pricing power. United experienced a decline in average revenue from passengers across all regions in the second quarter, especially in the domestic market.
Echoing Delta’s position, United stated that the industry is working to cut unprofitable routes with hopes of increasing airfares later this year.
United’s adjusted earnings in the second quarter reached $3.87 per share, exceeding analysts’ projections of $3.81 per share.
The company is set to discuss its financial results during a call with analysts and investors on Thursday morning.
