JBLU - JetBlue stock jumps on earnings beat optimistic forecast

2023-04-25 07:13:01 ET

JetBlue Airways ( NASDAQ: JBLU ) shares rose in premarket trading on Tuesday after the company topped Q1 earnings estimates and projected a strong travel season ahead.

The New York-based airline reported a $0.34 per share loss on $2.33B in operating revenue. Analysts had expected a $0.38 per share loss on $2.32B in revenue.

“Thanks to our team's collective hard work, our first quarter financial results came in better than expectations, and we are forecasting strong sequential pre-tax margin improvement into the second quarter. We remain well on track in executing our comprehensive plan to enhance our long-term profitability and restore our historical earnings power,” CEO Robin Hayes said. “For the second quarter, we expect strong revenue growth to continue as demand remains robust and as we see continued momentum from our commercial initiatives. We are forecasting a solidly profitable quarter, and we remain confident in our full-year earnings outlook.”

Management expects 5.5% to 8.5% growth in capacity for the 2023 fiscal year while revenue rises in the “high single digits to low double digits” range. Adjusted Earnings per Share are expected to range from $0.35 to $0.45 in Q2, setting a path to reach $0.70 to $1.00 for the full year. The full-year EPS forecasts comes in well above the $0.54 consensus.

“Demand trends remain robust into the second quarter, with strong demand for leisure and visiting-friends-and-relatives (VFR) travel particularly during peak periods,” COO Joanna Geraghty commented. “Our TrueBlue Loyalty program continues to show encouraging trends with strong growth in co-brand card spend. In addition, the Northeast Alliance, which is already a significant revenue generator, is driving meaningful margin improvement as our service matures.”

The outlook does not take into account the planned merger with Spirit Airlines ( SAVE ) nor does it account for ongoing regulatory reviews of the Northeast Alliance. Shares of the air carrier flew about 3% higher in premarket trading.

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