American Airlines Reports Second-Quarter 2024 Financial Results
American Airlines (NASDAQ: AAL) reported its Q2 2024 financial results, achieving record quarterly revenue of $14.3 billion, a 2% year-over-year increase. The company posted a net income of $717 million, or $1.01 per diluted share. Excluding net special items, net income was $774 million, or $1.09 per diluted share. AAL generated operating cash flow of $1.1 billion and free cash flow of $850 million in Q2. The airline reduced its total debt by $680 million and is on track to reduce total debt by $15 billion by the end of 2025. However, due to challenges in its sales and distribution strategy, AAL has revised its full-year 2024 adjusted earnings per diluted share guidance to between $0.70 and $1.30.
American Airlines (NASDAQ: AAL) ha riportato i risultati finanziari del secondo trimestre 2024, raggiungendo un fatturato trimestrale record di $14,3 miliardi, con un aumento del 2% rispetto all'anno precedente. La compagnia ha registrato un utili netto di $717 milioni, ovvero $1,01 per azione diluita. Escludendo elementi speciali netti, l'utile netto è stato di $774 milioni, oppure $1,09 per azione diluita. AAL ha generato un flusso di cassa operativo di $1,1 miliardi e un flusso di cassa libero di $850 milioni nel secondo trimestre. La compagnia aerea ha ridotto il suo debito totale di $680 milioni ed è sulla buona strada per ridurre il debito totale di $15 miliardi entro la fine del 2025. Tuttavia, a causa delle sfide nella sua strategia di vendita e distribuzione, AAL ha rivisto la sua guida sugli utili per azione diluita rettificati per l'intero anno 2024 a un intervallo compreso tra $0,70 e $1,30.
American Airlines (NASDAQ: AAL) informó sus resultados financieros del segundo trimestre de 2024, alcanzando unos ingresos trimestrales récord de $14,3 mil millones, un aumento del 2% en comparación con el año anterior. La compañía publicó un ingreso neto de $717 millones, o $1,01 por acción diluida. Excluyendo elementos especiales netos, el ingreso neto fue de $774 millones, o $1,09 por acción diluida. AAL generó un flujo de efectivo operativo de $1,1 mil millones y un flujo de efectivo libre de $850 millones en el segundo trimestre. La aerolínea redujo su deuda total en $680 millones y está en camino de reducir la deuda total en $15 mil millones para finales de 2025. Sin embargo, debido a los desafíos en su estrategia de ventas y distribución, AAL ha revisado su guía de ganancias ajustadas por acción diluida para todo el año 2024 a un rango de entre $0,70 y $1,30.
아메리칸 항공 (NASDAQ: AAL)은 2024년 2분기 재무 결과를 발표하며 역대 최고 분기 매출 143억 달러를 기록했다고 밝혔습니다. 이는 전년 대비 2% 증가한 수치입니다. 회사는 순익 7억 1천 7백만 달러, 즉 희석 주당 1.01 달러를 기록했습니다. 특별 항목을 제외한 순익은 7억 7천 4백만 달러, 또는 희석 주당 1.09 달러였습니다. AAL은 2분기에 운영 현금 흐름 11억 달러와 8억 5천만 달러의 자유 현금 흐름을 창출했습니다. 항공사는 총 부채를 6억 8천만 달러 줄였으며, 2025년 말까지 총 부채를 150억 달러 줄일 계획입니다. 그러나 판매 및 유통 전략의 어려움으로 인해 AAL은 2024년 전체에 대한 희석 주당 조정 수익 전망을 0.70달러에서 1.30달러 사이로 수정했습니다.
American Airlines (NASDAQ: AAL) a annoncé ses résultats financiers pour le deuxième trimestre 2024, atteignant un chiffre d'affaires trimestriel record de 14,3 milliards de dollars, soit une augmentation de 2 % par rapport à l'année précédente. La société a affiché un bénéfice net de 717 millions de dollars, soit 1,01 dollar par action diluée. En excluant les éléments spéciaux nets, le bénéfice net était de 774 millions de dollars, soit 1,09 dollar par action diluée. AAL a généré un flux de trésorerie opérationnel de 1,1 milliard de dollars et un flux de trésorerie disponible de 850 millions de dollars au deuxième trimestre. La compagnie aérienne a réduit sa dette totale de 680 millions de dollars et est en voie de réduire sa dette totale de 15 milliards de dollars d'ici fin 2025. Cependant, en raison de difficultés dans sa stratégie de vente et de distribution, AAL a ajusté sa prévision de bénéfice par action diluée pour l'année 2024 entre 0,70 et 1,30 dollar.
American Airlines (NASDAQ: AAL) hat seine finanziellen Ergebnisse für das zweite Quartal 2024 veröffentlicht und erzielte einen Rekordumsatz von 14,3 Milliarden Dollar, was einem Anstieg von 2 % im Vergleich zum Vorjahr entspricht. Das Unternehmen meldete einen Nettoertrag von 717 Millionen Dollar, oder 1,01 Dollar pro verwässerter Aktie. Ohne Berücksichtigung besonderer Posten betrug der Nettoertrag 774 Millionen Dollar, oder 1,09 Dollar pro verwässerter Aktie. AAL erzielte einen Betriebs-Cashflow von 1,1 Milliarden Dollar und einen freien Cashflow von 850 Millionen Dollar im zweiten Quartal. Die Fluggesellschaft reduzierte ihre Gesamtschulden um 680 Millionen Dollar und ist auf dem besten Weg, die Gesamtschulden bis Ende 2025 um 15 Milliarden Dollar zu senken. Aufgrund von Herausforderungen in ihrer Vertriebs- und Verkaufsstrategie hat AAL jedoch ihre Prognose für das bereinigte Ergebnis pro verwässerter Aktie für das Gesamtjahr 2024 auf einen Bereich von 0,70 bis 1,30 Dollar angepasst.
- Record quarterly revenue of $14.3 billion, up 2% year-over-year
- Q2 net income of $717 million, or $1.01 per diluted share
- Generated operating cash flow of $1.1 billion and free cash flow of $850 million in Q2
- Reduced total debt by $680 million in Q2
- On track to reduce total debt by $15 billion by the end of 2025
- Revised full-year 2024 adjusted EPS guidance down to $0.70-$1.30
- Challenges in sales and distribution strategy impacting revenue performance
- Expects Q3 2024 adjusted earnings per diluted share to be approximately breakeven
- Previous sales and distribution strategy to continue impacting revenue and earnings through year-end
Insights
American Airlines' Q2 2024 results present a mixed picture. While the company achieved record quarterly revenue of
The airline's efforts to reduce debt are noteworthy. They've decreased total debt by
However, the revised full-year adjusted earnings per diluted share guidance of
While American Airlines is taking aggressive action to improve revenue performance, including changes to their sales and distribution strategy, the effects may not be immediate. Investors should closely monitor the company's progress in implementing these changes and their impact on future quarters' results.
American Airlines' Q2 2024 results highlight the volatile nature of the airline industry. Despite achieving record revenue, the company's performance fell short due to strategic missteps in sales and distribution, coupled with an imbalance in domestic supply and demand. This underscores the critical importance of agile strategy adaptation in the highly competitive airline sector.
The company's swift response to reorient its sales and distribution strategy is commendable. Key actions include restoring competitive fares in traditional distribution channels, expanding AAdvantage Business™ benefits and strengthening relationships with corporate customers and travel agencies. These moves aim to address the revenue generation challenges while maintaining a customer-centric approach.
American's operational performance remains strong, with impressive results during the Fourth of July holiday and quick recovery from the global technology outage on July 19. This operational resilience is a positive sign, as reliability is important for customer satisfaction and long-term success in the airline industry.
However, the revised earnings guidance suggests that the impact of previous strategic decisions will continue to affect performance in the short term. The airline industry's sensitivity to factors such as fuel prices, economic conditions and competitive pressures means that American Airlines' ability to execute its new strategy effectively will be important for its financial recovery and future growth.
FORT WORTH, Texas, July 25, 2024 (GLOBE NEWSWIRE) -- American Airlines Group Inc. (NASDAQ: AAL) today reported its second-quarter 2024 financial results, including:
- Highest-ever quarterly revenue of
$14.3 billion . - Second-quarter net income of
$717 million , or$1.01 per diluted share. Excluding net special items1, second-quarter net income of$774 million , or$1.09 per diluted share. - Generated operating cash flow of approximately
$1.1 billion and free cash flow2 of approximately$850 million in the second quarter. - Reduced total debt3 by approximately
$680 million in the second quarter. - On track to reduce total debt3 from peak levels by
$15 billion by year-end 2025. - Full-year adjusted earnings per diluted share4 expected to be between
$0.70 and$1.30 .
“American has a fleet, network and product built to deliver results, but during the second quarter, we did not perform to our initial expectations due to our prior sales and distribution strategy and an imbalance of domestic supply and demand,” said American’s CEO Robert Isom. “We are taking this challenge head-on, with clear and decisive actions to deliver on a strategy that maximizes our revenue and profitability, and importantly, one that makes it easy for customers to do business with American. When we return to the level of revenue generation we know we can achieve, and we couple that with our operational reliability and best-in-class cost management, we will unlock significant value.”
Sales and distribution
American has taken swift and aggressive action to reorient its sales and distribution strategy in ways that continue to be customer-centric, while addressing feedback from corporate and agency partners. Since May, the airline has focused its near-term efforts in three areas:
Ensuring content availability
- Restored content. American has reinstated competitive fares in the distribution channel traditionally used by travel agencies and corporate managed travel programs.
- Removed plans to differentiate mileage earn by channel. Travelers continue to earn in the AAdvantage® program as usual, no matter where they book.
Making it easy, attractive and rewarding to do business with American
- Expanded availability of AAdvantage Business™ benefits to agencies. Companies will earn AAdvantage® miles and travelers will earn Loyalty Points anywhere business travel is booked, including when booked through travel agencies.
- Announced new features coming to AAdvantage Business™. Improvements will enhance the travel management and end-traveler experience.
Strengthening relationships and regaining the trust of partners
- Listening to feedback. The company has conducted extensive outreach to customers to inform them of changes being made to address pain points.
- Updating agreements. American is renegotiating contracts with corporate customers and travel agencies.
- Improving support. The airline is adding account managers for corporate customers, has established a dedicated AAdvantage Business™ customer service team and is increasing sales support for agencies.
Operational performance
The American Airlines team continues to produce strong operational results and demonstrate its resilience in recovering from irregular operations, as evidenced by its second-quarter performance, despite significant storms that impacted several key hubs in May and June. The airline also delivered a fantastic operation over the Fourth of July holiday, carrying 7.2 million customers and operating its largest-ever schedule while producing its best-ever combined completion factor over the holiday period. American quickly rebounded from the technology outage that impacted businesses worldwide on July 19. By that evening, its operation had fully recovered, and the airline delivered a
Financial performance
American produced record quarterly revenue of
Balance sheet and liquidity
American remains committed to strengthening its balance sheet. In the second quarter, the company reduced total debt3 by approximately
Guidance and investor update
American has taken aggressive action to improve its revenue performance, however, the company’s previous sales and distribution strategy will continue to impact its revenue performance and earnings through the remainder of the year. Accounting for these impacts and based on present demand trends, the current fuel price forecast and excluding the impact of special items, the company expects its third-quarter 2024 adjusted earnings per diluted share4 to be approximately breakeven. The company now expects its full-year 2024 adjusted earnings per diluted share4 to be between
For additional financial forecasting detail, please refer to the company’s investor update, furnished with this press release with the SEC on Form 8-K. This filing is also available at aa.com/investorrelations.
Conference call and webcast details
The company will conduct a live audio webcast of its financial results conference call at 7:30 a.m. CT today. The call will be available to the public on a listen-only basis at aa.com/investorrelations. An archive of the webcast will be available through Aug. 25.
Notes
See the accompanying notes in the financial tables section of this press release for further explanation, including a reconciliation of all GAAP to non-GAAP financial information and the calculation of free cash flow.
- The company recognized
$57 million of net special items in the second quarter after the effect of taxes, which principally included nonoperating net special items for charges associated with debt refinancings and mark-to-market net unrealized losses on certain equity investments. - Please see the accompanying notes for the company’s definition of free cash flow, which is a non-GAAP measure.
- All references to total debt include debt, finance and operating lease liabilities and pension obligations.
- Adjusted earnings per diluted share guidance excludes the impact of net special items. The company is unable to reconcile certain forward-looking information to GAAP as the nature or amount of net special items cannot be determined at this time.
About American Airlines Group
To Care for People on Life’s Journey®. Shares of American Airlines Group Inc. trade on Nasdaq under the ticker symbol AAL and the company’s stock is included in the S&P 500. Learn more about what’s happening at American by visiting news.aa.com and connect with American @AmericanAir and at Facebook.com/AmericanAirlines.
Cautionary statement regarding forward-looking statements and information
Certain of the statements contained in this report should be considered forward-looking statements within the meaning of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by words such as “may,” “will,” “expect,” “intend,” “anticipate,” “believe,” “estimate,” “plan,” “project,” “could,” “should,” “would,” “continue,” “seek,” “target,” “guidance,” “outlook,” “if current trends continue,” “optimistic,” “forecast” and other similar words. Such statements include, but are not limited to, statements about the company’s plans, objectives, expectations, intentions, estimates and strategies for the future, and other statements that are not historical facts. These forward-looking statements are based on the company’s current objectives, beliefs and expectations, and they are subject to significant risks and uncertainties that may cause actual results and financial position and timing of certain events to differ materially from the information in the forward-looking statements. These risks and uncertainties include, but are not limited to, those set forth herein as well as in the company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2024 (especially in Part I, Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Part II, Item 1A. Risk Factors), and other risks and uncertainties listed from time to time in the company’s other filings with the Securities and Exchange Commission. Additionally, there may be other factors of which the company is not currently aware that may affect matters discussed in the forward-looking statements and may also cause actual results to differ materially from those discussed. The company does not assume any obligation to publicly update or supplement any forward-looking statement to reflect actual results, changes in assumptions or changes in other factors affecting these forward-looking statements other than as required by law. Any forward-looking statements speak only as of the date hereof or as of the dates indicated in the statement.
| American Airlines Group Inc. | ||||||||||||||||||||||
| Condensed Consolidated Statements of Operations | ||||||||||||||||||||||
| (In millions, except share and per share amounts) | ||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||
| 3 Months Ended June 30, | Percent Increase | 6 Months Ended June 30, | Percent Increase | |||||||||||||||||||
| 2024 | 2023 | (Decrease) | 2024 | 2023 | (Decrease) | |||||||||||||||||
| Operating revenues: | ||||||||||||||||||||||
| Passenger | $ | 13,202 | $ | 12,978 | 1.7 | $ | 24,661 | $ | 24,081 | 2.4 | ||||||||||||
| Cargo | 195 | 197 | (1.3 | ) | 382 | 420 | (9.1 | ) | ||||||||||||||
| Other | 937 | 880 | 6.4 | 1,861 | 1,743 | 6.8 | ||||||||||||||||
| Total operating revenues | 14,334 | 14,055 | 2.0 | 26,904 | 26,244 | 2.5 | ||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||
| Aircraft fuel and related taxes | 3,061 | 2,723 | 12.4 | 6,042 | 5,890 | 2.6 | ||||||||||||||||
| Salaries, wages and benefits | 3,953 | 3,635 | 8.7 | 7,820 | 6,917 | 13.1 | ||||||||||||||||
| Regional expenses: | ||||||||||||||||||||||
| Regional operating expenses | 1,189 | 1,073 | 10.7 | 2,311 | 2,135 | 8.2 | ||||||||||||||||
| Regional depreciation and amortization | 79 | 80 | (0.1 | ) | 158 | 160 | (0.7 | ) | ||||||||||||||
| Maintenance, materials and repairs | 950 | 808 | 17.6 | 1,834 | 1,520 | 20.7 | ||||||||||||||||
| Other rent and landing fees | 834 | 762 | 9.5 | 1,653 | 1,470 | 12.5 | ||||||||||||||||
| Aircraft rent | 314 | 344 | (8.6 | ) | 642 | 688 | (6.7 | ) | ||||||||||||||
| Selling expenses | 456 | 489 | (6.8 | ) | 864 | 927 | (6.8 | ) | ||||||||||||||
| Depreciation and amortization | 474 | 483 | (1.9 | ) | 944 | 969 | (2.6 | ) | ||||||||||||||
| Special items, net | - | - | - | 70 | 13 | nm | ||||||||||||||||
| Other | 1,640 | 1,495 | 9.7 | 3,175 | 2,955 | 7.5 | ||||||||||||||||
| Total operating expenses | 12,950 | 11,892 | 8.9 | 25,513 | 23,644 | 7.9 | ||||||||||||||||
| Operating income | 1,384 | 2,163 | (36.0 | ) | 1,391 | 2,600 | (46.5 | ) | ||||||||||||||
| Nonoperating income (expense): | ||||||||||||||||||||||
| Interest income | 128 | 162 | (21.3 | ) | 246 | 288 | (14.7 | ) | ||||||||||||||
| Interest expense, net | (486 | ) | (548 | ) | (11.3 | ) | (984 | ) | (1,088 | ) | (9.7 | ) | ||||||||||
| Other income (expense), net | 2 | (14 | ) | nm | (1) | (38 | ) | (21 | ) | 86.1 | ||||||||||||
| Total nonoperating expense, net | (356 | ) | (400 | ) | (11.0 | ) | (776 | ) | (821 | ) | (5.5 | ) | ||||||||||
| Income before income taxes | 1,028 | 1,763 | (41.7 | ) | 615 | 1,779 | (65.4 | ) | ||||||||||||||
| Income tax provision | 311 | 425 | (26.6 | ) | 210 | 431 | (51.2 | ) | ||||||||||||||
| Net income | $ | 717 | $ | 1,338 | (46.4 | ) | $ | 405 | $ | 1,348 | (70.0 | ) | ||||||||||
| Earnings per common share: | ||||||||||||||||||||||
| Basic | $ | 1.09 | $ | 2.05 | $ | 0.62 | $ | 2.06 | ||||||||||||||
| Diluted | $ | 1.01 | $ | 1.88 | $ | 0.59 | $ | 1.91 | ||||||||||||||
| Weighted average shares outstanding (in thousands): | ||||||||||||||||||||||
| Basic | 656,965 | 653,602 | 656,406 | 652,801 | ||||||||||||||||||
| Diluted | 720,302 | 719,345 | 720,712 | 718,890 | ||||||||||||||||||
| Note: Percent change may not recalculate due to rounding. | ||||||||||||||||||||||
| (1) Not meaningful or greater than | ||||||||||||||||||||||
| American Airlines Group Inc. | ||||||||||||||||
| Consolidated Operating Statistics (1) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| 3 Months Ended June 30, | Increase | 6 Months Ended June 30, | Increase | |||||||||||||
| 2024 | 2023 | (Decrease) | 2024 | 2023 | (Decrease) | |||||||||||
| Revenue passenger miles (millions) | 65,144 | 60,020 | 8.5 | % | 122,617 | 112,034 | 9.4 | % | ||||||||
| Available seat miles (ASM) (millions) | 75,263 | 69,658 | 8.0 | % | 145,779 | 134,665 | 8.3 | % | ||||||||
| Passenger load factor (percent) | 86.6 | 86.2 | 0.4 | pts | 84.1 | 83.2 | 0.9 | pts | ||||||||
| Yield (cents) | 20.27 | 21.62 | (6.3 | ) | % | 20.11 | 21.49 | (6.4 | ) | % | ||||||
| Passenger revenue per ASM (cents) | 17.54 | 18.63 | (5.8 | ) | % | 16.92 | 17.88 | (5.4 | ) | % | ||||||
| Total revenue per ASM (cents) | 19.05 | 20.18 | (5.6 | ) | % | 18.46 | 19.49 | (5.3 | ) | % | ||||||
| Cargo ton miles (millions) | 515 | 427 | 20.6 | % | 999 | 849 | 17.7 | % | ||||||||
| Cargo yield per ton mile (cents) | 37.87 | 46.31 | (18.2 | ) | % | 38.25 | 49.51 | (22.8 | ) | % | ||||||
| Fuel consumption (gallons in millions) | 1,132 | 1,041 | 8.8 | % | 2,174 | 2,006 | 8.4 | % | ||||||||
| Average aircraft fuel price including related taxes (dollars per gallon) | 2.70 | 2.62 | 3.3 | % | 2.78 | 2.94 | (5.4 | ) | % | |||||||
| Operating cost per ASM (cents) | 17.21 | 17.07 | 0.8 | % | 17.50 | 17.56 | (0.3 | ) | % | |||||||
| Operating cost per ASM excluding net special items (cents) | 17.21 | 17.06 | 0.8 | % | 17.45 | 17.54 | (0.5 | ) | % | |||||||
| Operating cost per ASM excluding net special items and fuel (cents) | 13.14 | 13.16 | (0.1 | ) | % | 13.31 | 13.17 | 1.1 | % | |||||||
| Passenger enplanements (thousands) | 59,188 | 54,285 | 9.0 | % | 111,954 | 102,517 | 9.2 | % | ||||||||
| Departures (thousands): | ||||||||||||||||
| Mainline | 306 | 289 | 5.9 | % | 596 | 564 | 5.8 | % | ||||||||
| Regional | 243 | 209 | 16.2 | % | 462 | 411 | 12.6 | % | ||||||||
| Total | 549 | 498 | 10.3 | % | 1,058 | 975 | 8.6 | % | ||||||||
| Average stage length (miles): | ||||||||||||||||
| Mainline | 1,154 | 1,141 | 1.2 | % | 1,155 | 1,132 | 2.0 | % | ||||||||
| Regional | 457 | 463 | (1.4 | ) | % | 460 | 466 | (1.1 | ) | % | ||||||
| Total | 845 | 856 | (1.3 | ) | % | 852 | 851 | - | % | |||||||
| Aircraft at end of period: | ||||||||||||||||
| Mainline | 970 | 944 | 2.8 | % | 970 | 944 | 2.8 | % | ||||||||
| Regional (2) | 559 | 526 | 6.3 | % | 559 | 526 | 6.3 | % | ||||||||
| Total | 1,529 | 1,470 | 4.0 | % | 1,529 | 1,470 | 4.0 | % | ||||||||
| Full-time equivalent employees at end of period: | ||||||||||||||||
| Mainline | 107,400 | 104,400 | 2.9 | % | 107,400 | 104,400 | 2.9 | % | ||||||||
| Regional (3) | 30,000 | 28,100 | 6.8 | % | 30,000 | 28,100 | 6.8 | % | ||||||||
| Total | 137,400 | 132,500 | 3.7 | % | 137,400 | 132,500 | 3.7 | % | ||||||||
| Note: Amounts may not recalculate due to rounding. | ||||||||||||||||
| (1) Unless otherwise noted, operating statistics include mainline and regional operations. Regional includes wholly-owned regional airline subsidiaries and operating results from capacity purchase carriers. | ||||||||||||||||
| (2) Includes aircraft owned and leased by American as well as aircraft operated by third-party regional carriers under capacity purchase agreements. Excluded from the aircraft count above are 65 regional aircraft in temporary storage as of June 30, 2024 as follows: 55 Embraer 145, eight Bombardier CRJ 700, and two Embraer 170. | ||||||||||||||||
| (3) Regional full-time equivalent employees only include our wholly-owned regional airline subsidiaries. | ||||||||||||||||
| American Airlines Group Inc. | |||||||||||||||||
| Consolidated Revenue Statistics by Region | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| 3 Months Ended June 30, | Increase | 6 Months Ended June 30, | Increase | ||||||||||||||
| 2024 | 2023 | (Decrease) | 2024 | 2023 | (Decrease) | ||||||||||||
| Domestic (1) | |||||||||||||||||
| Revenue passenger miles (millions) | 43,183 | 39,758 | 8.6 | % | 81,994 | 75,509 | 8.6 | % | |||||||||
| Available seat miles (ASM) (millions) | 49,613 | 45,700 | 8.6 | % | 96,716 | 90,255 | 7.2 | % | |||||||||
| Passenger load factor (percent) | 87.0 | 87.0 | - | pts | 84.8 | 83.7 | 1.1 | pts | |||||||||
| Passenger revenue (dollars in millions) | 9,342 | 9,195 | 1.6 | % | 17,604 | 17,232 | 2.2 | % | |||||||||
| Yield (cents) | 21.63 | 23.13 | (6.5 | ) | % | 21.47 | 22.82 | (5.9 | ) | % | |||||||
| Passenger revenue per ASM (cents) | 18.83 | 20.12 | (6.4 | ) | % | 18.20 | 19.09 | (4.7 | ) | % | |||||||
| Latin America (2) | |||||||||||||||||
| Revenue passenger miles (millions) | 8,576 | 7,926 | 8.2 | % | 18,672 | 16,934 | 10.3 | % | |||||||||
| Available seat miles (millions) | 9,873 | 9,200 | 7.3 | % | 21,611 | 19,710 | 9.6 | % | |||||||||
| Passenger load factor (percent) | 86.9 | 86.2 | 0.7 | pts | 86.4 | 85.9 | 0.5 | pts | |||||||||
| Passenger revenue (dollars in millions) | 1,562 | 1,640 | (4.8 | ) | % | 3,464 | 3,555 | (2.6 | ) | % | |||||||
| Yield (cents) | 18.21 | 20.69 | (12.0 | ) | % | 18.55 | 20.99 | (11.6 | ) | % | |||||||
| Passenger revenue per ASM (cents) | 15.82 | 17.82 | (11.2 | ) | % | 16.03 | 18.04 | (11.1 | ) | % | |||||||
| Atlantic | |||||||||||||||||
| Revenue passenger miles (millions) | 11,527 | 10,689 | 7.8 | % | 17,982 | 16,510 | 8.9 | % | |||||||||
| Available seat miles (millions) | 13,629 | 12,823 | 6.3 | % | 22,671 | 21,065 | 7.6 | % | |||||||||
| Passenger load factor (percent) | 84.6 | 83.4 | 1.2 | pts | 79.3 | 78.4 | 0.9 | pts | |||||||||
| Passenger revenue (dollars in millions) | 2,019 | 1,888 | 7.0 | % | 3,012 | 2,819 | 6.8 | % | |||||||||
| Yield (cents) | 17.52 | 17.66 | (0.8 | ) | % | 16.75 | 17.07 | (1.9 | ) | % | |||||||
| Passenger revenue per ASM (cents) | 14.82 | 14.72 | 0.7 | % | 13.28 | 13.38 | (0.7 | ) | % | ||||||||
| Pacific | |||||||||||||||||
| Revenue passenger miles (millions) | 1,858 | 1,647 | 12.9 | % | 3,969 | 3,081 | 28.8 | % | |||||||||
| Available seat miles (millions) | 2,148 | 1,935 | 11.0 | % | 4,781 | 3,635 | 31.5 | % | |||||||||
| Passenger load factor (percent) | 86.5 | 85.1 | 1.4 | pts | 83.0 | 84.8 | (1.8 | ) | pts | ||||||||
| Passenger revenue (dollars in millions) | 279 | 255 | 9.4 | % | 581 | 475 | 22.4 | % | |||||||||
| Yield (cents) | 15.02 | 15.50 | (3.1 | ) | % | 14.64 | 15.40 | (5.0 | ) | % | |||||||
| Passenger revenue per ASM (cents) | 13.00 | 13.19 | (1.4 | ) | % | 12.15 | 13.06 | (6.9 | ) | % | |||||||
| Total International | |||||||||||||||||
| Revenue passenger miles (millions) | 21,961 | 20,262 | 8.4 | % | 40,623 | 36,525 | 11.2 | % | |||||||||
| Available seat miles (millions) | 25,650 | 23,958 | 7.1 | % | 49,063 | 44,410 | 10.5 | % | |||||||||
| Passenger load factor (percent) | 85.6 | 84.6 | 1.0 | pts | 82.8 | 82.2 | 0.6 | pts | |||||||||
| Passenger revenue (dollars in millions) | 3,860 | 3,783 | 2.1 | % | 7,057 | 6,849 | 3.0 | % | |||||||||
| Yield (cents) | 17.58 | 18.67 | (5.8 | ) | % | 17.37 | 18.75 | (7.4 | ) | % | |||||||
| Passenger revenue per ASM (cents) | 15.05 | 15.79 | (4.7 | ) | % | 14.38 | 15.42 | (6.7 | ) | % | |||||||
| Note: Amounts may not recalculate due to rounding. | |||||||||||||||||
| (1) Domestic results include Canada, Puerto Rico and U.S. Virgin Islands. | |||||||||||||||||
| (2) Latin America results include the Caribbean. | |||||||||||||||||
| Reconciliation of GAAP Financial Information to Non-GAAP Financial Information | |||||||||||||||||||||||
| American Airlines Group Inc. (the Company) sometimes uses financial measures that are derived from the condensed consolidated financial statements but that are not presented in accordance with GAAP to understand and evaluate its current operating performance and to allow for period-to-period comparisons. The Company believes these non-GAAP financial measures may also provide useful information to investors and others. These non-GAAP measures may not be comparable to similarly titled non-GAAP measures of other companies, and should be considered in addition to, and not as a substitute for or superior to, any measure of performance, cash flow or liquidity prepared in accordance with GAAP. The Company is providing a reconciliation of reported non-GAAP financial measures to their comparable financial measures on a GAAP basis. The tables below present the reconciliations of the following GAAP measures to their non-GAAP measures: - Operating Income (GAAP measure) to Operating Income Excluding Net Special Items (non-GAAP measure) - Operating Margin (GAAP measure) to Operating Margin Excluding Net Special Items (non-GAAP measure) - Pre-Tax Income (GAAP measure) to Pre-Tax Income Excluding Net Special Items (non-GAAP measure) - Pre-Tax Margin (GAAP measure) to Pre-Tax Margin Excluding Net Special Items (non-GAAP measure) - Net Income (GAAP measure) to Net Income Excluding Net Special Items (non-GAAP measure) - Basic and Diluted Earnings Per Share (GAAP measure) to Basic and Diluted Earnings Per Share Excluding Net Special Items (non-GAAP measure) Management uses these non-GAAP financial measures to evaluate the Company's current operating performance and to allow for period-to-period comparisons. As net special items may vary from period-to-period in nature and amount, the adjustment to exclude net special items allows management an additional tool to understand the Company’s core operating performance. Additionally, the tables below present the reconciliations of total operating costs (GAAP measure) to total operating costs excluding net special items and fuel (non-GAAP measure) and total operating costs per ASM (CASM) to CASM excluding net special items and fuel. Management uses total operating costs excluding net special items and fuel and CASM excluding net special items and fuel to evaluate the Company's current operating performance and for period-to-period comparisons. The price of fuel, over which the Company has no control, impacts the comparability of period-to-period financial performance. The adjustment to exclude fuel and net special items allows management an additional tool to understand and analyze the Company’s non-fuel costs and core operating performance. | |||||||||||||||||||||||
| Reconciliation of Operating Income Excluding Net Special Items | 3 Months Ended June 30, | Percent Increase | 6 Months Ended June 30, | Percent Increase | |||||||||||||||||||
| 2024 | 2023 | (Decrease) | 2024 | 2023 | (Decrease) | ||||||||||||||||||
| (in millions) | (in millions) | ||||||||||||||||||||||
| Operating income as reported | $ | 1,384 | $ | 2,163 | $ | 1,391 | $ | 2,600 | |||||||||||||||
| Operating net special items: | |||||||||||||||||||||||
| Mainline operating special items, net (1) | - | - | 70 | 13 | |||||||||||||||||||
| Regional operating special items, net | - | 6 | - | 6 | |||||||||||||||||||
| Operating income excluding net special items | $ | 1,384 | $ | 2,169 | (36.2 | %) | $ | 1,461 | $ | 2,619 | (44.2 | %) | |||||||||||
| Calculation of Operating Margin | |||||||||||||||||||||||
| Operating income as reported | $ | 1,384 | $ | 2,163 | $ | 1,391 | $ | 2,600 | |||||||||||||||
| Total operating revenues as reported | $ | 14,334 | $ | 14,055 | $ | 26,904 | $ | 26,244 | |||||||||||||||
| Operating margin | 9.7 | % | 15.4 | % | 5.2 | % | 9.9 | % | |||||||||||||||
| Calculation of Operating Margin Excluding Net Special Items | |||||||||||||||||||||||
| Operating income excluding net special items | $ | 1,384 | $ | 2,169 | $ | 1,461 | $ | 2,619 | |||||||||||||||
| Total operating revenues as reported | $ | 14,334 | $ | 14,055 | $ | 26,904 | $ | 26,244 | |||||||||||||||
| Operating margin excluding net special items | 9.7 | % | 15.4 | % | 5.4 | % | 10.0 | % | |||||||||||||||
| Reconciliation of Pre-Tax Income Excluding Net Special Items | |||||||||||||||||||||||
| Pre-tax income as reported | $ | 1,028 | $ | 1,763 | $ | 615 | $ | 1,779 | |||||||||||||||
| Pre-tax net special items: | |||||||||||||||||||||||
| Mainline operating special items, net (1) | - | - | 70 | 13 | |||||||||||||||||||
| Regional operating special items, net | - | 6 | - | 6 | |||||||||||||||||||
| Nonoperating special items, net (2) | 12 | 28 | 58 | 45 | |||||||||||||||||||
| Total pre-tax net special items | 12 | 34 | 128 | 64 | |||||||||||||||||||
| Pre-tax income excluding net special items | $ | 1,040 | $ | 1,797 | (42.1 | %) | $ | 743 | $ | 1,843 | (59.7 | %) | |||||||||||
| Calculation of Pre-Tax Margin | |||||||||||||||||||||||
| Pre-tax income as reported | $ | 1,028 | $ | 1,763 | $ | 615 | $ | 1,779 | |||||||||||||||
| Total operating revenues as reported | $ | 14,334 | $ | 14,055 | $ | 26,904 | $ | 26,244 | |||||||||||||||
| Pre-tax margin | 7.2 | % | 12.5 | % | 2.3 | % | 6.8 | % | |||||||||||||||
| Calculation of Pre-Tax Margin Excluding Net Special Items | |||||||||||||||||||||||
| Pre-tax income excluding net special items | $ | 1,040 | $ | 1,797 | $ | 743 | $ | 1,843 | |||||||||||||||
| Total operating revenues as reported | $ | 14,334 | $ | 14,055 | $ | 26,904 | $ | 26,244 | |||||||||||||||
| Pre-tax margin excluding net special items | 7.3 | % | 12.8 | % | 2.8 | % | 7.0 | % | |||||||||||||||
| Reconciliation of Net Income Excluding Net Special Items | 3 Months Ended June 30, | Percent Increase | 6 Months Ended June 30, | Percent Increase | |||||||||||||||||||
| 2024 | 2023 | (Decrease) | 2024 | 2023 | (Decrease) | ||||||||||||||||||
| (in millions, except share and per share amounts) | (in millions, except share and per share amounts) | ||||||||||||||||||||||
| Net income as reported | $ | 717 | $ | 1,338 | $ | 405 | $ | 1,348 | |||||||||||||||
| Net special items: | |||||||||||||||||||||||
| Total pre-tax net special items (1), (2) | 12 | 34 | 128 | 64 | |||||||||||||||||||
| Net tax effect of net special items | 45 | (1 | ) | 15 | (8 | ) | |||||||||||||||||
| Net income excluding net special items | $ | 774 | $ | 1,371 | (43.6 | %) | $ | 548 | $ | 1,404 | (60.9 | %) | |||||||||||
| Reconciliation of Basic and Diluted Earnings Per Share Excluding Net Special Items | |||||||||||||||||||||||
| Net income excluding net special items | $ | 774 | $ | 1,371 | $ | 548 | $ | 1,404 | |||||||||||||||
| Shares used for computation (in thousands): | |||||||||||||||||||||||
| Basic | 656,965 | 653,602 | 656,406 | 652,801 | |||||||||||||||||||
| Diluted | 720,302 | 719,345 | 720,712 | 718,890 | |||||||||||||||||||
| Earnings per share excluding net special items: | |||||||||||||||||||||||
| Basic | $ | 1.18 | $ | 2.10 | $ | 0.84 | $ | 2.15 | |||||||||||||||
| Diluted (3) | $ | 1.09 | $ | 1.92 | $ | 0.79 | $ | 1.98 | |||||||||||||||
| Reconciliation of Total Operating Costs per ASM Excluding Net Special Items and Fuel | |||||||||||||||||||||||
| Total operating expenses as reported | $ | 12,950 | $ | 11,892 | $ | 25,513 | $ | 23,644 | |||||||||||||||
| Operating net special items: | |||||||||||||||||||||||
| Mainline operating special items, net (1) | - | - | (70 | ) | (13 | ) | |||||||||||||||||
| Regional operating special items, net | - | (6 | ) | - | (6 | ) | |||||||||||||||||
| Total operating expenses excluding net special items | 12,950 | 11,886 | 25,443 | 23,625 | |||||||||||||||||||
| Aircraft fuel and related taxes | (3,061 | ) | (2,723 | ) | (6,042 | ) | (5,890 | ) | |||||||||||||||
| Total operating expenses excluding net special items and fuel | $ | 9,889 | $ | 9,163 | $ | 19,401 | $ | 17,735 | |||||||||||||||
| (in cents) | (in cents) | ||||||||||||||||||||||
| Total operating expenses per ASM as reported | 17.21 | 17.07 | 17.50 | 17.56 | |||||||||||||||||||
| Operating net special items per ASM: | |||||||||||||||||||||||
| Mainline operating special items, net (1) | - | - | (0.05 | ) | (0.01 | ) | |||||||||||||||||
| Regional operating special items, net | - | (0.01 | ) | - | - | ||||||||||||||||||
| Total operating expenses per ASM excluding net special items | 17.21 | 17.06 | 17.45 | 17.54 | |||||||||||||||||||
| Aircraft fuel and related taxes per ASM | (4.07 | ) | (3.91 | ) | (4.14 | ) | (4.37 | ) | |||||||||||||||
| Total operating expenses per ASM excluding net special items and fuel | 13.14 | 13.16 | 13.31 | 13.17 | |||||||||||||||||||
| Note: Amounts may not recalculate due to rounding. | |||||||||||||||||||||||
| FOOTNOTES: | |||||||||||||||||||||||
| (1) | The 2024 six month period mainline operating special items, net principally included | ||||||||||||||||||||||
| (2) | Principally included charges associated with debt refinancings and extinguishments as well as mark-to-market net unrealized gains and losses associated with certain equity investments. | ||||||||||||||||||||||
| (3) | The 2024 three and six month period diluted earnings per share gives effect to, among other things, the Company's outstanding | ||||||||||||||||||||||
| American Airlines Group Inc. | ||||||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||||
| (In millions)(Unaudited) | ||||||||||||
| 6 Months Ended June 30, | ||||||||||||
| 2024 | 2023 | |||||||||||
| Net cash provided by operating activities | $ | 3,308 | $ | 5,096 | ||||||||
| Cash flows from investing activities: | ||||||||||||
| Capital expenditures and aircraft purchase deposits | (1,475 | ) | (1,244 | ) | ||||||||
| Proceeds from sale-leaseback transactions and sale of property and equipment | 353 | 183 | ||||||||||
| Purchases of short-term investments | (4,714 | ) | (7,587 | ) | ||||||||
| Sales of short-term investments | 3,881 | 4,656 | ||||||||||
| Decrease in restricted short-term investments | 68 | 33 | ||||||||||
| Other investing activities | (5 | ) | 214 | |||||||||
| Net cash used in investing activities | (1,892 | ) | (3,745 | ) | ||||||||
| Cash flows from financing activities: | ||||||||||||
| Payments on long-term debt and finance leases | (1,836 | ) | (3,246 | ) | ||||||||
| Proceeds from issuance of long-term debt | 527 | 2,143 | ||||||||||
| Other financing activities | (48 | ) | (55 | ) | ||||||||
| Net cash used in financing activities | (1,357 | ) | (1,158 | ) | ||||||||
| Net increase in cash and restricted cash | 59 | 193 | ||||||||||
| Cash and restricted cash at beginning of period | 681 | 586 | ||||||||||
| (1) | Cash and restricted cash at end of period | $ | 740 | $ | 779 | |||||||
| (1) | The following table provides a reconciliation of cash and restricted cash to amounts reported within the condensed consolidated balance sheets: | |||||||||||
| Cash | $ | 605 | $ | 614 | ||||||||
| Restricted cash included in restricted cash and short-term investments | 135 | 165 | ||||||||||
| Total cash and restricted cash | $ | 740 | $ | 779 | ||||||||
| Free Cash Flow | ||||||||
| The Company's free cash flow summary is presented in the table below, which is a non-GAAP measure that management believes is useful information to investors and others in evaluating the Company's ability to generate cash from its core operating performance that is available for use to reinvest in the business or to reduce debt. The Company defines free cash flows as net cash provided by operating activities less net cash used in investing activities, adjusted for (1) net purchases of short-term investments and (2) change in restricted cash. We believe that calculating free cash flow as adjusted for these items is more useful for investors because short-term investment activity and restricted cash are not representative of activity core to our operations. This non-GAAP measure may not be comparable to similarly titled non-GAAP measures of other companies, and should be considered in addition to, and not as a substitute for or superior to, any measure of performance, cash flow or liquidity prepared in accordance with GAAP. Our calculation of free cash flow is not intended, and should not be used, to measure the residual cash flow available for discretionary expenditures because, among other things, it excludes mandatory debt service requirements and certain other non-discretionary expenditures. | ||||||||
| 6 Months Ended June 30, 2024 | ||||||||
| (in millions) | ||||||||
| Net cash provided by operating activities | $ | 3,308 | ||||||
| Adjusted net cash used in investing activities (1) | (1,091 | ) | ||||||
| Free cash flow | $ | 2,217 | ||||||
| (1) | The following table provides a reconciliation of adjusted net cash used in investing activities for the six months ended June 30, 2024 (in millions): | |||||||
| Net cash used in investing activities | $ | (1,892 | ) | |||||
| Adjustments: | ||||||||
| Net purchases of short-term investments | 833 | |||||||
| Increase in restricted cash | (32 | ) | ||||||
| Adjusted net cash used in investing activities | $ | (1,091 | ) | |||||
| American Airlines Group Inc. | |||||||
| Condensed Consolidated Balance Sheets | |||||||
| (In millions, except shares) | |||||||
| June 30, 2024 | December 31, 2023 | ||||||
| (unaudited) | |||||||
| Assets | |||||||
| Current assets | |||||||
| Cash | $ | 605 | $ | 578 | |||
| Short-term investments | 7,841 | 7,000 | |||||
| Restricted cash and short-term investments | 875 | 910 | |||||
| Accounts receivable, net | 2,067 | 2,026 | |||||
| Aircraft fuel, spare parts and supplies, net | 2,575 | 2,400 | |||||
| Prepaid expenses and other | 832 | 658 | |||||
| Total current assets | 14,795 | 13,572 | |||||
| Operating property and equipment | |||||||
| Flight equipment | 42,752 | 41,794 | |||||
| Ground property and equipment | 10,198 | 10,307 | |||||
| Equipment purchase deposits | 1,052 | 760 | |||||
| Total property and equipment, at cost | 54,002 | 52,861 | |||||
| Less accumulated depreciation and amortization | (22,958 | ) | (22,097 | ) | |||
| Total property and equipment, net | 31,044 | 30,764 | |||||
| Operating lease right-of-use assets | 7,873 | 7,939 | |||||
| Other assets | |||||||
| Goodwill | 4,091 | 4,091 | |||||
| Intangibles, net | 2,047 | 2,051 | |||||
| Deferred tax asset | 2,668 | 2,888 | |||||
| Other assets | 1,607 | 1,753 | |||||
| Total other assets | 10,413 | 10,783 | |||||
| Total assets | $ | 64,125 | $ | 63,058 | |||
| Liabilities and Stockholders’ Equity (Deficit) | |||||||
| Current liabilities | |||||||
| Current maturities of long-term debt and finance leases | $ | 4,120 | $ | 3,632 | |||
| Accounts payable | 3,016 | 2,353 | |||||
| Accrued salaries and wages | 1,767 | 2,377 | |||||
| Air traffic liability | 8,030 | 6,200 | |||||
| Loyalty program liability | 3,619 | 3,453 | |||||
| Operating lease liabilities | 1,209 | 1,309 | |||||
| Other accrued liabilities | 2,849 | 2,738 | |||||
| Total current liabilities | 24,610 | 22,062 | |||||
| Noncurrent liabilities | |||||||
| Long-term debt and finance leases, net of current maturities | 27,636 | 29,270 | |||||
| Pension and postretirement benefits | 2,652 | 3,044 | |||||
| Loyalty program liability | 6,031 | 5,874 | |||||
| Operating lease liabilities | 6,482 | 6,452 | |||||
| Other liabilities | 1,460 | 1,558 | |||||
| Total noncurrent liabilities | 44,261 | 46,198 | |||||
| Stockholders' equity (deficit) | |||||||
| Common stock, 656,607,802 shares outstanding at June 30, 2024 | 7 | 7 | |||||
| Additional paid-in capital | 7,389 | 7,374 | |||||
| Accumulated other comprehensive loss | (4,858 | ) | (4,894 | ) | |||
| Retained deficit | (7,284 | ) | (7,689 | ) | |||
| Total stockholders' deficit | (4,746 | ) | (5,202 | ) | |||
| Total liabilities and stockholders’ equity (deficit) | $ | 64,125 | $ | 63,058 | |||
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