Near-term headwinds dampen JetBlue’s full-year expectations

JetBlue's full-year optimism has been dampened by several operational challenges
Felix Mizioznikov /

Despite JetBlue achieving a record-breaking Q2 2023, recent headwinds, some of which were out of the airline’s control, dampened the airline’s full-year guidance. 

In Q2 2023, the New York John F. Kennedy International Airport (JFK)-based airline earned $2.6 billion in revenue (H1 2023: $4.9 billion), which allowed it to post a profitable quarter ($138 million). However, due to a loss-making Q1 2023, JetBlue ended the first six months of 2023 with a net loss of $54 million. 

“Thanks to the hard work of our fantastic Crewmembers, we generated our highest quarterly profit since 2019, demonstrating the progress we have made since the pandemic,” said Robin Hayes, the chief executive officer (CEO) of JetBlue, adding that the results were underpinned by record quarterly revenues.  

Hayes said that those revenues, as well as the airline’s strong operational performance, reflect “the benefits from our significant investments and robust preparations for the peak summer travel period”.  

However, the airline was forced to update its full-year earnings outlook to reflect near-term headwinds related to the cessation of its North East Alliance (NEA) with American Airlines, a challenging operating environment in the northeast, and much more pressure on domestic travel than anticipated. 

As such, the Year-on-Year improvements to revenue are now between 6% and 9% (at the end of Q1 2023: high single digits to low double digits), while adjusted earnings per share (EPS) is now between $0.05 and $0.40 (Q1 2023: $0.70 and $1.00). 

It detailed that the wind-down of the NEA reduced the full-year EPS estimates by between $0.20 and $0.25, while operational challenges related to Air Traffic Control (ATC) and weather in the northeast reduced the EPS estimate by a further $0.20 to $0.25.  

Lastly, the unexpected pressure on its domestic operations, stemming from “a greater than expected shift of pent-up COVID demand to long-haul international markets which is pressuring demand for domestic travel” resulted in the annual EPS estimate being reduced by a further $0.15 to $0.20. 

READ MORE: JetBlue introduces a new and blue standard livery: video 

Still, the airline expected to spend less on fuel, with its full-year estimated fuel price per gallon being between $2.85 and $3.05. At the end of the previous quarter, it was between $2.95 and $3.15. 

“While challenges persist in the near term, we are pulling every lever at our disposal to continue to drive cost efficiencies, including better utilization, technology upgrades, fleet modernization and our structural cost program,” noted Ursula Hurley, the chief financial officer (CFO) of JetBlue. 

The airline forecasted that, as of June 30, 2023, Airbus should deliver 11 A220, four A321neo, and four A321LR in 2023. JetBlue plans to return four Airbus A320 and six Embraer E190 in 2023, with a further eight and 16 aircraft of the type, respectively, in 2024. 

JetBlue retired its first-ever Airbus A320 aircraft on July 31, 2023. 

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