Earnings expectations

JetBlue Airways (JBLU) is slated to report its first quarter of fiscal 2019 results on April 23. Analysts expect JetBlue’s first-quarter bottom-line results to take a hit from lower revenue growth, increased operating expenses, and higher fuel costs. The Wall Street EPS estimate of $0.13 for JetBlue implies a decline of ~54% year-over-year from its EPS of $0.27 in the first quarter of 2018.

Wall Street Expects JetBlue’s Q1 Earnings to Plunge Over 50%

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Revenue growth is also expected to slow down this quarter to 6.4% and reach $1.87 billion in the first quarter of 2019. JetBlue had reported strong double-digit revenue growth for the last two quarters.

Management guidance

Over the last month, JetBlue has lowered its first-quarter unit revenue outlook twice. The company reduced its first-quarter unit revenue guidance by 2.6%, citing low fares for last-minute bookings and weak demand in off-peak periods as the main factors.

JetBlue now expects its unit revenue to decline 3.1% year-over-year, compared with its initial guidance range of down 2% to up 1% (with a mid-point -0.5%). During JPMorgan’s Aviation, Transportation and Industrials Conference on March 5, the company also revealed that the US government’s notification against travel to Haiti would also hurt first-quarter top- and bottom-line results.

On the cost front, JetBlue now anticipates its ex-fuel CASM (cost per available seat mile) to grow at or below the lower end of its previous guidance range of 1.5%–3.5%. However, it has raised fuel cost expectations to $2.05–$2.06 per gallon from the initial forecast of $2.01 per gallon.

Peers’ expectations

Among the major US air carriers (IYT), Delta Air Lines (DAL) has reported first-quarter results with adjusted EPS soaring 28% year-over-year. For United Airlines (UAL), which is slated to report its results today, analysts expect adjusted EPS to grow 89%.

American Airlines (AAL) and Southwest Airlines (LUV) are scheduled to report their first-quarter results in the next week. Analysts expect the two airline operators to see year-over-year declines of 19.1% and 21.9% in their respective first-quarter earnings.

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