Since JBLU’s traffic growth has outpaced its capacity growth, utilization has improved for the seventh straight month. JetBlue’s utilization improved by 1.6 percent points to 88.1% in August 2018. Year-to-date in August 2018, utilization improved by 1.0 percentage point to 86.3%.
Delta Air Lines (DAL) and United Continental (UAL) also improved their utilization in August. In contrast, Alaska Air (ALK) and Southwest Airlines (LUV) have seen declines in their utilization. American Airlines (AAL) and Spirit Airlines (SAVE) have stopped reporting monthly traffic numbers.
For the first quarter of 2018, JetBlue’s yields improved 4.4% YoY to 14.26 cents. However, increased competition led to yields declining by 2.2% YoY in the second quarter. JBLU also introduced a new platform for vacation sales, which customers took some time adjusting to.
Unit revenues also declined
JBLU’s revenue per available seat mile (or RASM), commonly known as unit revenues, improved 4.4% YoY in the first quarter of 2018 on the back of yield improvement. In Q2 2018, RASM declined by 1.2% YoY to 12.74 cents, following the decline in yields.
Investors can gain exposure to JBLU by investing in the First Trust Mid Cap Value AlphaDEX Fund (FNK), which holds 0.73% of its portfolio in JBLU. Read our next article to see what JetBlue’s guidance is for Q3 2018.