US airline JetBlue (JBLU) is expecting to return to profitability in the spring and is looking forward to a “very strong” summer peak period after an Omicron dip at the start of 2022.
Like other airlines reporting financial results this week, including Wizz and easyJet in Europe, recovery at JetBlue (JBLU) has been knocked back by the arrival of the Omicron variant of COVID-19.
JetBlue (JBLU) said the surge in cases of the Omicron variant was especially bad in the north-east of the United States, leading to booking cancellations and a reluctance to make new bookings during a period when lots of bookings are usually made. Like rivals in North America, the low-cost carrier also had to cancel flights as the virus meant more crew calling in sick.
“While Omicron has temporarily weighed on demand in the very near-term, we expect sequential month-on-month improvement through the quarter, ultimately returning to sustained profitability in the spring and beyond,” Robin Hayes, JetBlue’s (JBLU) chief executive officer, said in a statement on January 27, 2022.
For the fourth quarter of 2021, JetBlue (JBLU) said revenue fell 9.7% and it made a GAAP pre-tax loss of $163 million, compared to a pre-tax income of $220 million in the fourth quarter of 2019.
Hayes said were it not for Omicron, JetBlue (JBLU) would be expecting higher revenue for the first quarter of 2022 than in the first quarter of 2019. Instead, it is expecting first quarter revenue to fall by between 11-16% compared with pre-pandemic levels.
“This sequential slowdown reflects the large negative impact from Omicron on Q1 demand,” Joanna Geraghty, President and Chief Operating Officer, explained. “However, trends have largely stabilized and are improving across all geographies. As quickly as the Omicron variant swept through the Northeast, we are seeing cases rapidly decline and we expect sequential month-on-month improvement leading to a profitable Q2 and a very strong summer peak.
JetBlue (JBLU) is planning for first quarter capacity to be between -1% and +2% of pre-crisis levels. For the full year 2022, it expects to increase capacity by 11-15% compared with 2019, although Geraghty said this remains flexible.
“We expect the demand recovery to regain steam following the temporary setback tied to the Omicron variant. We’ll continue to be nimble and react to the environment,” Geraghty concluded.