TLDR
- AAL stock fell ~8% after American Airlines cut its full-year 2026 earnings outlook due to rising fuel costs.
- New 2026 guidance: adjusted EPS ranging from a loss of 65 cents to a profit of 65 cents, down from a prior range of -40 cents to +$1.10.
- Q2 adjusted EPS came in at 15 cents, beating the 3-cent Wall Street estimate; revenue rose 16% to $16.74 billion.
- Q3 outlook calls for a loss of 70 cents to 10 cents per share, well below the 26-cent profit analysts expected.
- CEO Robert Isom acknowledged “work ahead” but said progress is real, with plans for new wide-body aircraft and more premium seats.
American Airlines (AAL) stock dropped around 8% on Thursday after the carrier cut its full-year 2026 earnings outlook, even as it beat Wall Street estimates for the second quarter. The stock fell to around $14.24 in premarket trading, moving further from its 50-day moving average.
American Airlines Group Inc., AAL
The airline posted Q2 adjusted EPS of 15 cents, well ahead of the 3-cent consensus. Revenue grew 16.3% year-over-year to $16.74 billion, narrowly topping the $16.71 billion analysts had penciled in.
But the guidance is what spooked investors.
AMERICAN AIRLINES $AAL Q2’26 EARNINGS:
🔹 Revenue: $16.74B (Est. $16.71B) 🟢; +16.3% YoY
🔹 Adj EPS: $0.15 (Est. $0.03) 🟢; -84% YoY
🔹 Load Factor: 83.2% (Est. 84.7%) 🔴; -1.5 points YoY
🔸 Fuel expense up 83% YoY ($2.2B headwind)FY26 Guide:
🔹 Mid EPS: $0.00 (Est. $0.61) 🔴… pic.twitter.com/eSQa3HAIvO— Wall St Engine (@wallstengine) July 23, 2026
American now expects full-year 2026 adjusted EPS to land somewhere between a loss of 65 cents and a profit of 65 cents. That’s a sharp cut from the April forecast of a loss of 40 cents to a gain of $1.10.
Fuel prices are the main culprit. Jet fuel is the airline’s biggest cost after labor, and the spike this year has been hard to fully absorb despite higher ticket prices.
For Q3, American is guiding to a loss of between 70 cents and 10 cents per share. Wall Street had been expecting a profit of 26 cents. Revenue is forecast to rise 16% to 19%, which is actually slightly above analyst expectations of 16.6%.
Profit Gap With Delta and United Widens
CEO Robert Isom acknowledged last month that American is trying to close the margin gap with Delta and United — but that gap has actually grown wider. He didn’t give a timeline for when American expects to catch up.
On the capacity side, American plans to expand flying by up to 5% in Q3.
Isom said the company is planning to order new wide-body aircraft this year and retrofit older jets with more high-margin premium seats. “While there’s still work ahead, the progress we’re making is real,” he wrote in a staff note Thursday.
Net Profit Fell 88% Year-Over-Year
Despite the revenue beat, American’s net profit dropped 88% compared to a year ago — from $599 million, or 91 cents per share, down to just $71 million, or 11 cents per share.
Passenger revenue per available seat mile — a key measure of pricing power — rose 10% year-over-year, showing demand remains solid even as costs climb.
Full-year Wall Street consensus had been 61 cents in earnings for 2026. American’s new guidance midpoint sits at zero.
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