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American Airlines cuts profit outlook amid fuel costs
American Airlines has announced that it has lowered its profit expectations for 2026 due to rising jet fuel costs. The airline now expects its adjusted earnings to range from a loss of 65 cents to a profit of 65 cents per share, essentially reaching break-even. Fuel costs have increased by approximately $1.6 billion since July, reducing the original forecast of substantial profits and causing the company's stock to drop about 7% in morning trading. Despite higher ticket revenue and continued travel demand, rising fuel prices are constraining profit margins, especially since American Airlines faces greater challenges compared to its competitors due to narrower profit margins. The company projects that the increase in fuel costs during 2026 will exceed $6 billion, although gains from revenue growth and improved cost management are expected to help boost profit margins once fuel prices stabilize. For the third and fourth quarters, the outlook predicts revenue growth between 16% and 19% year-over-year, with an estimated adjusted loss between 70 cents and 10 cents per share in Q3, as the average jet fuel price rises to around $3.75 per gallon.
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