American Airlines (NASDAQ:AAL) lost more than $2.2 billion in the first three months of the year — its biggest quarterly loss since 2008 —as the coronavirus pandemic drove down demand for air travel.
American’s revenue dropped nearly 20% from a year earlier to $8.52 billion, slightly below analyst estimates.
American, like other airlines is facing a sharp decline in passengers because of coronavirus. U.S. airline travel volumes dropped about 95% in recent weeks from a year earlier as travelers stay home.
The air travel slump is a sharp turnaround for the industry that boasted its 10th straight year of profits in 2019 and had prepared for another uptick in travel demand this year.
The carrier has raced to cut costs, slashing flights and freezing hiring. In the second-quarter it expects to burn through roughly $70 million a day, which it forecast to fall to about $50 million a day in June.
Close to 39,000 employees have volunteered for unpaid or partially-paid leave. American had more than 133,000 staff members as of the end of last year.
American is also taking steps to shore up liquidity, which it expects to increase to $11 billion at the end June, up from $6.8 billion at the end of the first quarter.
It also expects to have up to $10.6 billion in federal payroll grants and loans under the $2.2-trillion coronavirus relief package Congress approved last month.
Shares lost 83 cents, or 6.6%, to $11.80 to start Thursday.
