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While the revenue story has improved for U.S. carriers, the cost story has become a headwind. Still, as American Airlines demonstrated in its fourth quarter results, costs are a headwind that can be overcome. With that, AA joined Delta and United in delivering solid fourth quarters and downright strong full-year results.
Rising labor costs at Delta dented its fourth quarter results significantly—but not enough to prevent the airline from posting a terrific profit for 2016. And the big story within the story is that revenues have stopped falling. All in all, Delta remains bullish, which is a nice way to kick off earnings season.
Airline Weekly Lounge Episode 59: Forward-looking Statement
Leisure demand was one of the defining stories of 2016—will the trend continue? Is the burgeoning low-cost longhaul model for real? What about premium travel? Will Airbus and Boeing see a rebound in aircraft orders? Will the CSeries continue the momentum it saw in 2016?
Airline Weekly Lounge Episode 57 - Heading South
By just a tenth of a percent, United’s fourth quarter operating profit margin bested that of Delta—and likely that of American, who reports later—making United, for the quarter, No.1 among the Big Three U.S. carriers. So, has the natural order shifted from United being a perennial laggard to leader?
SAS has tried and tried to turn itself around, but to no avail—at least judging by its recent earnings report. In fact, on profits alone, the airline’s third quarter was a step backward. What’s going wrong, and can it be fixed? Meanwhile, Frontier Airlines posted a tremendous profit in the third quarter, with an operating margin among the best of the best.
Airline Weekly Lounge Episode 58: Reductive Reasoning (Sponsor)
Airline Weekly Lounge Episode 56 - CEO Interview: Frontier’s Biffle (Sponsor)
Airline Weekly Lounge Episode 55: Canadian Continuity (Sponsor)
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