A filing United posted on Monday offers a glimpse into how the Boeing 737 Max 9 groundings are financially impacting airlines.
United Airlines is forecasting a first-quarter loss as a result of the grounding of the Boeing 737 Max 9.
The carrier said it expects an adjusted loss of 35 to 85 cents a share during the first quarter, according to a filing it posted on Monday, providing a glimpse into the financial fallout from the issues with the Max 9, which have been grounded since January 5.
Alaska Airlines and United are the only two U.S. carriers that operate that model. United has the most Max 9s of any carrier, with 79 in its fleet. Alaska hasn’t posted anything yet on the impact of the groundings, but it is expected to report its fourth-quarter earnings on January 25.
The groundings, which happened after a door plug blew off an Alaska Airlines jet mid-air, have forced United to cancel hundreds of flights a day. The carrier said it anticipated 737-9 cancellations to last through January 26, but the recent filing accounts for cancellations through the end of January.
United expects unit costs, excluding fuel, to rise by three percentage points in the first three months of 2024 as a result of the groundings. The carrier also expected revenue to stay flat during the first quarter.
United CEO Scott Kirby has reportedly expressed frustration with Boeing’s ongoing quality issues, according to Bloomberg.
The company otherwise forecasts an adjusted profit of $9 to $11 per share in 2024, which compares with $9.58 per share expected by Wall Street analysts, according to Reuters.
During the fourth quarter, United posted a net income of $600 million, around a 29% decrease from last year. Revenue for 2023 was up 10% from 2022, at $2.6 billion.
“Our plans really came together in 2023, and I want to thank the United team for all of the hard work it took to get us there,” Kirby said in a statement.
United also said it saw strong travel demand through 2023 and revenue increases for its premium and basic economy cabins.
The carrier is holding an earnings call at 10:30 a.m. ET on Tuesday.
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