United Airlines (NYSE: UAL) posted higher profits in the first three months of the year, but higher costs chipped away at the airline's bottom line.
The airline on Tuesday reported net income of $147 million, up nearly 50% from a year ago. Revenues rose more than 7% from the first quarter of 2017 to $9.032 billion, slightly higher than Wall Street estimates.
United's per-share profits on an adjusted basis came in at 50 cents a share, above the 40 cents analysts had expected.
The carrier said its fuel costs rose by 26% in the first quarter, compared with the year-ago period. Fuel was its second-largest expense after salaries, which rose 3% on the year. Higher expenses have weighed on airline profits as they grapple with strong demand and growth that is becoming costlier.
For the full-year, the airline expects to post per-share earnings of $7.00 to $8.50.
The airline has a conference scheduled for later this morning, at which time United will likely provide more detail on its costs and fare outlook. An aggressive expansion plan had spooked investors earlier this year as adding seats and flights could drive down fares.
The airline may also address its review of its animal-transport program, which it recently suspended, pending a review, following the death of a passenger's puppy that was placed in an overhead bin and mix-ups with other dogs that were sent to the wrong destinations.
Shares in the airline climbed 51 cents to $67.85
