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Investing.com – United Airlines stock (NASDAQ:UAL) traded 1.1% down in premarket Thursday after the carrier was forced to admit it won’t return to pre-pandemic levels of traffic this year.
The airline had earlier estimated its capacity would grow 5% from pre-pandemic levels in 2022. The somber guidance comes as Omicron-variant Covid-19 delays the recovery in travel through a variety of channels. The company has had to cancel flights this year due to illness-related absenteeism and to international travel bans, hastily introduced by a number of governments to stop the spread of disease.
United estimates its costs in the current quarter to be 14%-15% running higher than in the same period in 2019, due largely to staff shortages and other supply chain problems. The price of jet fuel is also increasingly becoming a concern, with oil prices back at their highest in seven years.
United’s total operating revenue for the December quarter rose 140% year-on-year to $8.2 billion, but that was still only at three-quarters of the same period in 2019. On an adjusted basis, the carrier reported a loss of $1.6 per share for the three months through December, its eighth straight quarter of losses. However, it was narrower than expected and a marked improvement from $7 a year ago.
“While Omicron is impacting near-term demand, we remain optimistic about the spring and excited about the summer and beyond,” United Chief Executive Officer Scott Kirby (NYSE:KEX) said in a statement.
United said its Boeing (NYSE:BA) 777-200 planes equipped with Pratt & Whitney engines would begin to return to service in the current quarter. It was forced to ground all of its 52 wide-body jets last year after one of its flights to Honolulu suffered an engine failure and made an emergency landing in Denver.
