- American said 80% of 2024 revenue will be driven by its loyalty program and passengers who buy tickets that cost more than the cheapest seats.
- The carrier is planning to expand its domestic first-class seats on older aircraft.
- The airline declined to provide profit or revenue forecasts for the first quarter or full year.
A Boeing 737 passenger aircraft of American Airlines arrives from Austin at JFK International Airport in New York as the Manhattan skyline looms in the background on February 7, 2024.
American Airlines said Monday that 80% of its revenue this year will come from loyalty program members and passengers who buy more expensive tickets, up from a 70% share in 2017.
American and other carriers have poured billions of dollars into new cabins, lounges and onboard upgrades to cater to high-spending travelers. American’s rival, Delta Air Lines, has repeatedly said that growth in premium revenue, which it considers tickets for extra legroom seats and higher-end cabins, has become a bigger share of its overall sales and is growing faster than ticket sales in the coach cabin.
American earlier Monday said that it was ordering 260 new Boeing, Airbus and Embraer planes to revamp its fleet and that it would retrofit older Airbus planes to increase the size of their first-class cabins.
American’s revenue forecast is part of its first investor day in more than six years. It considers “premium content” tickets that cost more than the cheapest offering. The Fort Worth, Texas-based airline said it expects to grow pretax margins in the coming years and chip away at its debt load.
The carrier declined to provide profit or revenue forecasts for the first quarter or full year. Analysts polled by LSEG, formerly known as Refinitiv, are projecting 2024 earnings per share of $2.56 and revenue of $54.97 billion.
American shares were down more than 4% in afternoon trading.
Don’t miss these stories from CNBC PRO:
-
AWS and Clarity AI to use generative AI to boost sustainable investments
-
Ref Watch: 'Enough' of a foul to disallow Man City goal vs Liverpool
-
Day in the Life: Ex-England rugby star on organising this year's Emirates Dubai Sevens
-
Pandya returns to MI, Green goes to RCB
-
Snowstorm kills eight in Ukraine and Moldova, hundreds of towns lose power
-
‘This is why fewer Sikhs visiting gurdwaras abroad’: BJP after Indian envoy heckled in Long Island
-
Inside a Dubai home with upcycled furniture and zero waste
-
Captain Turner aims for Pitch 1 return as JESS bid to retain Dubai Sevens U19 crown
-
No Antoine Dupont but Dubai still set to launch new era for sevens
-
Why ESG investors are concerned about AI
-
Your campsite can harm the environment
-
Mubadala, Saudi Fund deals on US radar for potential China angle
-
Abu Dhabi T10 season seven to kick off with thrilling double-header
-
Eight climate fiction, or cli-fi, books to consider before Cop28