JetBlue Shares Fall After 4Q2024 Results & Disappointing Outlook
JBLU shares fell more than 25% this morning (Jan. 28).
(Long Island City, New York) Shares of JetBlue (NASDAQ: JBLU) are down more than 25% at $6.06 as of 10.38am this morning after the company forecast higher costs and unit revenue below analysts’ expectations for 1Q2025 this morning (Jan. 28); as for 4Q2024, JetBlue reported a smaller-than-expected loss of 21 cents per share, aided by cost-saving initiatives and improved pricing, vs. analyst expectations of an adjusted loss of $0.31 per share, per Reuters.
Photo of a JetBlue Airbus A320 courtesy of JetBlue.
JetBlue’s 4Q2024 release can be found here.
JetBlue forecast that its unit costs, excluding fuel, will rise as much as 7% this year from 2024; in 1Q2025, it said it expected this metric to rise up to 10% in the quarter year-over-year, per CNBC.
Per Reuters, JetBlue forecast first-quarter revenue per available seat mile (RASM), an industry metric commonly known as unit revenue, a proxy for pricing power, to range from a 0.5% decline to 3.5% higher this quarter over last year, compared with analysts’ average expectations of 6.88% growth, according to data compiled by LSEG. Per CNBC, larger competitors Delta (NYSE: DAL) and United (NASDAQ: UAL) have been forecasting higher revenue growth, a sign of stronger airline pricing power.
JetBlue said that it expects its 2025 revenue to rise between 3% and 6% on flat capacity.
JetBlue said it expects the shift of Easter, which typically sees a strong holiday rush, to the second quarter will reduce its unit revenue by about 1.5% this quarter; it also expects unit costs, excluding fuel, to increase by 8% to 10% in the current quarter, per Reuters.
The airline is facing higher operating costs as ongoing inspections of [RTX]’(https://www.rtx.com/)s (NYSE: RTX)
Pratt & Whitney Geared Turbofan engines have grounded several of its aircraft.
Per CNBC, JetBlue is in the middle of a plan to reduce costs by culling unprofitable routes, deferring aircraft and drumming up revenue with higher-priced seats; senior pilots have been offered voluntary early retirement packages.
In 2024 and 2023, respectively, the company lost two antitrust cases that blocked two of its growth strategies: in 2024, a federal judge blocked JetBlue’s planned acquisition of Spirit Airlines, and in 2023, JetBlue lost a case over its regional partnership with American Airlines (NASDAQ: AAL).
