United Airlines Holdings Inc. (NASDAQ:UAL) reported first-quarter revenue and profit that beat analyst estimates, but the carrier cut its full-year earnings forecast, citing the impact of surging jet fuel prices.
"These are results our employees can be proud of, and they show the resilience of our long-term strategy, even in the face of escalating fuel expense," Chief Executive Officer Scott Kirby said in a statement.
The Chicago-based airline posted a 10.7 percent year-over-year revenue increase to $14.61 billion, which was above the $14.37 billion consensus. Adjusted earnings came in at $1.19 per share, topping the average analyst estimate of $1.07. Net income for the quarter rose 80 percent to $699 million. Key operating metrics such as load factor and revenue per available seat mile were not immediately disclosed.
The strong results were overshadowed by a significant reduction in the company's outlook. United slashed its full-year 2026 adjusted earnings guidance to a range of $7 to $11 per share, a steep drop from its previous forecast of $12 to $14. The revision comes as the airline projects its average fuel price will be approximately $4.30 a gallon in the second quarter, a sharp increase from previous months. For the second quarter, United forecast adjusted earnings of between $1 and $2 a share, below the analyst consensus of $2.08.
The lowered guidance from United reflects a broader industry challenge, with Alaska Airlines also pulling its 2026 forecast on Monday due to the same fuel price pressures. United said it expects to offset only 40 to 50 percent of the fuel price increase through revenue in the second quarter, though it anticipates that figure rising to nearly 100 percent by year-end.
The earnings report follows a period of speculation regarding industry consolidation. Last week, American Airlines publicly rejected the idea of a merger with United. The topic resurfaced Tuesday when President Donald Trump commented he was against such a combination, while also suggesting struggling carrier Spirit Airlines could be an acquisition target.
The guidance cut signals that while travel demand remains strong, elevated operating costs will pressure profitability in the near term. Investors will be watching for management's commentary on cost controls and fare adjustments during the upcoming earnings call on Wednesday.
This article is for informational purposes only and does not constitute investment advice.
