United Airlines, Second-Quarter Results, and Plans

One of the world’s largest airlines released information about their second quarter. Quite unfortunately for them, during that second quarter, United Airlines lost $1.63 billion. As a reminder, last year, in the second quarter, the Chicago-based carrier generated profit.

Unfortunately, its revenue dropped to $1.48 billion in the second quarter, this would the quarter ending on June 30, as it usually does.

Consequently, compared to the same period last year, revenue fell from $11.4 billion to $1.48 billion or 87%. Interestingly, despite all the challenges, revenue surpassed expectations, as analysts expected the revenue to fall even lower.

The Chicago-based carrier, as well as its competitors, allocated its time and money to expand its networks over the years. Nevertheless, the coronavirus pandemic affected their operations significantly. It is hard to blame these companies, as they lost billions of dollars due to the coronavirus pandemic.

United Airlines and interesting details

In the future, United Airlines expects to reduce its cash burn to $25 million a day in the third quarter. As a reminder, in the previous quarter, this number was higher by $15 million.

According to United Airlines, its capacity in the third quarter will likely be down 65% compared to the same period of time in 2019.

However, United expects to finish the third quarter with the lowest average daily cash burn among major carriers.

Importantly, United expects its flights to be a little less than half full in July. Furthermore, no more than 15% of its flights will be more than 70% full.

The carrier should be proud of its cargo unit, as its revenue jumped by 36% compared to the same period a year ago. Consequently, revenues reached $402 million. This was after United added more than 4,800 cargo flights. The cargo unit generated 27% of the carrier’s revenue in the second quarter.

The coronavirus pandemic created a lot of problems for the industry. Hopefully, airlines are working hard to adapt to the new reality.