The stock of American Airlines (AAL) is down 3% after the world’s largest carrier lowered its forward guidance due to rising jet fuel costs.
The Dallas, Texas-based company reported second-quarter earnings per share (EPS) of $0.15 U.S., which beat the $0.03 U.S. forecast on Wall Street.
Revenue in the April through June period totaled $$16.74 billion U.S., which topped the consensus estimate among analysts of $16.71 billion U.S. Sales were up 16% from a year ago.
Despite the strong print, American Airlines lowered its full-year 2026 earnings outlook, citing higher fuel costs as the Iran war pushes crude oil prices back near $100 U.S. a barrel.
Management at American Airlines said the company could post an adjusted loss per share of as much as $0.65 U.S. this year due to soaring jet fuel costs.
Jet fuel is typically an airline’s second biggest expense after labour costs. American and other carriers have raised fares this year to try and offset the increased fuel expenses.
However, management at American Airlines said the fare increases aren’t enough to fully offset this year’s spike in jet fuel.
American Airlines also said that it plans to expand its flying capacity by as much as 5% in the current third quarter. It is also ordering new wide-body aircraft this year.
Prior to today (July 23), AAL stock had declined 5% in 2026 to trade at $14.79 U.S. per share.
