JetBlue Shares Climb Nearly 15% After Q3 Results Ease Investor Concerns

JetBlue Airways reported a larger third-quarter loss compared to the prior year, though the New York-based airline noted that robust travel demand continues to help offset rising fuel expenses as it works to restore investor confidence following a recent decline in its stock price.

Shares of JetBlue rose nearly 15% in premarket trading on Tuesday.

For the quarter ending Sept. 30, JetBlue posted a net loss of $257 million, up from a $143 million loss in the same period last year. The airline’s fuel costs increased 61% year-over-year, reaching $868 million.

“Resilient demand and strong yields drove revenue well ahead of our initial expectations, allowing us to recapture more of the increase in fuel costs than we initially expected,” said CEO Joanna Geraghty in an earnings statement. “That momentum has carried into the fourth quarter, with Fort Lauderdale continuing to perform exceptionally well as we expand capacity.”

The airline reported that its average fare increased more than 19% to $245.11 per passenger, compared to $205.67 during the previous year’s third quarter.

JetBlue management will host an earnings call on Tuesday at 10 a.m. ET to discuss the company’s strategic direction and address concerns about its long-term viability amid ongoing losses. According to the Wall Street Journal, some of JetBlue’s senior creditors have been working with restructuring adviser PJT Partners.

The airline projected that its revenue per available seat mile—a key performance indicator that reflects operating revenue generated for each seat flown one mile—could rise as much as 22% during the fourth quarter, contributing to an anticipated full-year growth rate of 13.5% to 14.5%.

JetBlue stated it concluded the quarter with $2.2 billion in liquidity and an unencumbered asset portfolio valued at approximately $7 billion, which includes $2.8 billion in aircraft and engines.

As of Sept. 30, the company carried a total debt balance of $8.4 billion, according to its quarterly earnings filing.

“We’re confident in our ability to use current liquidity and financing tools to support operations through projected milestones, including achieving at least $1 in adjusted earnings per share and positive free cash flow by 2028,” said CFO Ursula Hurley. “Our focus remains on strict cost control and prudent capital allocation as we move toward sustained profitability.”

Below is a summary of JetBlue’s third-quarter results versus analysts’ expectations compiled by LSEG:

• Adjusted loss per share: 60 cents vs. an expected 55 cents
• Revenue: $2.81 billion vs. an estimated $2.82 billion

JetBlue has not reported a full-year profit since 2019. The airline is executing a multiyear restructuring plan that involves reducing costs and enhancing revenue through product upgrades such as a newly introduced domestic first-class cabin that recently launched for sale.

Higher fuel prices have weighed heavily on airline profitability industry-wide. Despite increasing fares by over 20% in 2023, JetBlue has seen only modest impact on travel demand, which has remained surprisingly resilient.

Competition from larger carriers has also posed challenges for JetBlue beyond rising operational costs.

The airline previously attempted to acquire the now-defunct Spirit Airlines, but that transaction was halted by a federal court ruling that found it would reduce market competition. Separately, a proposed regional codeshare agreement with American Airlines was also blocked by a judge, despite arguments from both companies that the partnership would enhance their competitive position in the densely served Northeast corridor. Currently, JetBlue maintains a strategic alliance with United Airlines.

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