United has a strong presence in the domestic market, particularly in New York. It has the highest number of daily departures (451 flights) from New York, with a 37% New York corporate revenue share. In the international segment, the Atlantic region has contributed 18% to the overall revenue growth. The company also has a strong presence in China. United’s revenue from the Atlantic and Pacific markets comprises 33% of the total revenue.
United (UAL) and American Airlines (AAL) derive almost equal share (57%) of revenue from the U.S. market, while Delta gets a higher share (65%). United’s low-cost competitors, Southwest (LUV) and JetBlue (JBLU), concentrate their operations in the domestic market, contributing to more than 90% revenue.
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Performance in 2013
United’s revenue in 2013 increased by 3%, driven by a 1.7% growth in passenger revenue and a 20% growth in other operating revenue. Cargo revenue, however, decreased 13% due to lower freight volume and yield.
Although there was a decrease in traffic and capacity, a 1.8% increase in yield and 2.6% increase in average fare per passenger (2.6%) led to the increase in passenger revenue. The Atlantic region was the primary driver of the revenue growth, with 18% growth in revenue supported by 5.1% growth in yield. This was slightly offset by a 12% decline in the Pacific region revenue.
The growth in other operating revenue was driven by the sale of aircraft fuel of $400 million to a third party, revenue from a non-airline party under the Mileage Plus program, passenger ticket change fees, and sales of airport lounge access.