[NEW YORK] United Airlines reported a drop in second-quarter profits on Wednesday on higher costs and predicted a rise in travel as geopolitical worries ease.
The carrier, which was forced to scale back operations at its New York-area hub for part of the quarter due to air traffic control problems, said it saw an increase in bookings in early July and attributed the improvement to “less geopolitical and macroeconomic uncertainty.”
While revenues edged up 1.7 per cent in the first quarter to US$15.2 billion compared with the year-ago period, profits fell 26.4 per cent to US$973 million.
United had higher salary costs compared with the year-ago period. The carrier also accounted for US$561 million in one-time costs in connection with a tentative labour agreement with its flight attendants union.
United pointed to a turnaround in its performance at Newark, New Jersey after problems with the airport’s air traffic operation led to delays and flight cancellations throughout much of May.
The airline was forced to cancel many flights per day after an April 28 equipment outage resulted in Newark’s air traffic controllers losing radar and communications with planes for 90 seconds.
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Following that incident, US air officials slowed traffic during this period due to insufficient staffing.
But United has pointed to improved performance at Newark following moves by US officials to replace some outdated equipment.
United’s operation at Newark “led all other major airlines in on-time performance and lowest seat cancellation rate at all New York City area airports,” United said in its press release.
United plans to resume service between its Newark hub and Tel Aviv, Israel on July 21 after suspending service due to the Iran-Israel war.
“United saw a positive shift in demand beginning in early July, and, like 2024, anticipates another inflection in industry supply in mid-August,” said United CEO Scott Kirby.
“The world is less uncertain today than it was during the first six months of 2025 and that gives us confidence about a strong finish to the year.”
United projected full-year 2025 profits of between US$9 and US$11 per share. Those figures are about US$2 above the range of its “recessionary environment” forecast from April, but about US$2.50 per share below the “stable environment” projection.
Shares of United fell 1.5 per cent in after-hours trading. AFP
