United Airlines (UAL) 18 Jul 242024 Q2 Earnings call transcript

Good morning, and welcome to the United Airlines Holdings Earnings Conference Call for the Second Quarter 2024. My name is Brianna, and I will be your conference facilitator today. [Operator Instructions]

This call is being recorded and is copyrighted. Please note that no portion of the call may be recorded, transcribed or rebroadcast without the company's permission.

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these do drop not you terms, agree If with simply line. off the

will Managing presentation today's I Please the your turn for host go over ahead. call, of Director to Edwards, Investor Relations. Kristina now

Conference Good which Earnings is our at Yesterday, you, available Quarter Brianna. to Second our ir.united.com. everyone, on morning, Thank we welcome issued and United's XXXX Call. release, earnings website

Airlines statements. conference yesterday's forward-looking refer and a release for remarks call factors of and and thorough materially based results may information from reports statements United All this description differ actual the other to more upon Please factors. the of earnings United forward-looking release, with to XX-Q in are Information expectations. Holdings and company. Form to made contain XX-K could the available cause our Airlines filed during number current currently these A by our SEC

we be and on otherwise reconciliations Unless definitions financial press call. basis in related on metrics non-GAAP our a release. will refer the this noted, Please to discussing our

non-GAAP to For our of these release. of the the GAAP tables refer measures a at end comparable the most earnings measures, reconciliation please directly to

results the and Chief Executive Kirby; Financial Officer, Joining to us and Leskinen. Officer, President Vice Chief Nocella; Executive President and call outlook Commercial Executive discuss and President, on Chief our Vice are Hart; today Scott Brett Officer, Andrew Mike

the executive Q&A. on the In of line available addition, to we other have in team and assist the members

to I'd like Scott. call to now turn over And the

our We did our further Good last culture produced United thank solid Thank focus already quarter. team over safety sharpening morning, months. the Kristina. The while strong several and you. on improving you, that another

our with safer our safer wide variety customers. airline striving our make for a to ever before at metrics, airline employees our our rooted and constantly and culture Looking is of than

FAA with to continuing we're closely to work that. exactly partners and the other So do

Hurricane operational weather, Beryl our getting delivering safe amidst customers to in Additionally, destinations performance to for including and thank our time. employees their challenging top-tier you Houston, on and

is a demand, to cancel experiencing always capacity is the anticipating the airlines flying other years. also in where the that solid many this second this August see to today industry couple their begin large continued along the was industry are schedules. that would lines in earnest in domestic to past that a and in pressure the flying, developing due of exceeded that of part been growth unprofitable we've unprofitable still show U.S. The It carriers inevitable happening markets. for quarter was While it you half in quarter

As a the roughly setup the second result, quarter out points backdrop and close as that it by beneficial by quarter, domestic heading provide into fourth growth the capacity a where we X were moderate to year a we should the appears compared particularly constructive in industry which will XXXX.

having more despite the to in on than Boeing in any industry. began XXXX, -- and world, than operating COVID exposure the the San history our in been running picture has other United We're consistently of hubs the operation most airline the early despite driving issues the the in Newark Since best big in and the developments ahead world. curve Chicago, difficult Francisco, at any

revenue. revenue they that always and have we proud care top Our world best the to are teams drive And have the the people environment, are strategic demand of and for management and technical customers. of United, on the and our transformed service adjustments in making completely commercial

are change our strategy. to Next happen execution, with great a has that great permanently And by that in us accident. that the was yields the is within And also we the solid are our advanced works now That great pudding. matter. inflection know we as But PRASM domestic bookings our in that We've the are position changes right of in mid-August industry the a we They're relative and absolute the all row. while allowed point. proof schedule on the results see industry, growth can industry strategy years our really impact already and United a led having the to now, outperformance X proud capacity only industry. but structurally I and hit cannot

we absolutely are controlling no-excuses to what to we And our can and our philosophy guidance. hit committed

that relative of as to developing our we going are in the we're taking quarter. so also the industry cost we aggressive changes domestic fourth points ensure while the reducing just And in and our our immediate outside control. targets. short as outperforming results to expected basis industry not meet is capacity and term steps rely we We're management expected, on That includes XXX

a to to The -- tough Next The United United. that continues be industry to $X within EPS result, to rationalization continue despite beginning environment is reached of our expected XXXX point. industry plan and be the out, we've expect as the full we range play $XX the be winning we for inflection strategy us. year to And guidance to around

it that, Brett. hand with over to And I'll

Scott, you, morning. and good Thank

flying in history, This while the our quarter, for ever delivering operational to million. the we XX on-time most continued over second performance, quarter completion pandemic in rate and performance, since a passengers factor achieve seat the best the record cancellation quarter

on-time handle our XQ has for largest our the the for our better number results best customers. to and us history. Newark in across the flights these company its and produce FAA hub, The balance runways, allowing May waiver aerospace in of between enabled and facilities efficiently safely Newark, with in and at with broke network, several of its departures records being April Looking own

of out times not irregular during more meaningful of our to environment than The adapt the Newark. to flights over X last Operational Six primary excellence operating operations. benefits made a reliability, limited departed on-time were was improvements hubs more have to our challenging competitors. our year to particularly shown

frontline experience benefits to is efficiency Our an better from by the strong operation, safety customer This line. driving possible without employees. bottom been to operational our not have our culture, underpinned even would and commitment excellence translating the into

for to their you hard thank them all So work. of

As I is customer operation but driving is it our efficiency, also before, experience. strong mentioned not positively our impacting only

result, investing results of a the scores NPS highest all ice -- cream aspects of quarter our Tillamook in introduction We're were pandemic. the product, since the second quarter our aircraft. highest As our onboard including

the like will and customer United app informed U.S. becomes lag the weather continue also our key differentiate a attendant texting pause radar preferred for automatically Additionally, and when can due impact features be that pilot share started product journey. classes in delivery available. resumed preferences priority premier to global United airline stay downloaded Boeing and maps about to flight I'm months to seat customers a that This in customers app hiring remain the of gears summer, May new the their leading in July. Investment can and in continues us the classes carrier. Shifting brief to after increment to our they as most experience to a delays with during their reseat will seat June, weather we pleased part employees. delays, of these how so country to one we

of United and to end busy operating team a a complex in to innovate us. adapt summer continues have environment. we ahead, front Looking of The

$XX per on that describe has this United Andrew earnings track and we will $X remain year. to deliver While it's a of bright trends, in to some clear the future, share near-term

I'll now it to over hand Andrew.

billion, Thanks, more revenues year-over-year. QX United year-over-year. down $XX capacity in X.X% total Brett. X.X% TRASM reported today of up was X.X% on

the best to year-over-year be United's QX revenues peers. of in unit expect We large our all

PRASM on Domestic X.X% by fell capacity. X.X% more

continue across which of Atlantic at exceeded levels declines PRASM that have to seen. year-over-year. on still more while Cargo Asia PRASM the pressure unprofitable Flights and gain with strong have a up domestic we small International As also some by PRASM solid year-over-year. yields capacity MileagePlus quarter flights is on widely had XX% fell demand America declines to another in discussed, had Latin forecasted, XQ. helping PRASM industry XX%. see than put X.X% yet higher capacity revenues stabilized cushion the

markets our ground segments road frequent we to fee in revenue our due key key no-change which X ground. gain travelers, United continue continue is believe business to to gained policy, among Our warrior global products, the was road up quarter warriors leading X%. in up diverse revenue passenger network Revenue total set XX% MileagePlus while from award-winning was our these of program. and our our

Consolidated up year-over-year. by contribution X.X quarter, the Demand and $X.X was premium United's capacity capacity, Polaris premium Polaris X.X%. increased were billion. in factor including Economy by up cabin Premium to revenues seats. Business RASMs points. increased premium-plus points X.X% for X.X year-over-year in the load was strong outperforming Plus, non-premium

to were Contracted continue domestic up see for points and up product X XX first-class points XXXX XXXX. versus premium sold factors revenues our business with year-over-year. also XX% demand versus We load strong

offer of our up were United the and continue we in basic strong Basic grow as to number Economy revenues we increase total gauge. remained year-over-year. plans XX% to seats mainline

our seatback percent a likely power basic the for will However, LCC, stay United of as first or MileagePlus. and capacity includes customers basic sale over which choose unmatched ULCC sales United offers an a of features the always stable or higher-margin product, continue competitive expand When at we will given we to benefits fares faster. of premium believe with rates, as entertainment seat decline along

revenue industry trail QX results expectations. and the United for did

Excess incremental could the at industry demand It with capacity was, up in increasingly in clear not pressured XXXX. fact, it that capacity, in back yields. turn, just is quarter Looking the strong. added domestic now, keep

capacity scheduled While in estimate industry June, levels Based capacity capacity half published industry similar levels schedules, and domestic on published the increased is beyond. pivot these the domestic QX by second XXXX we X.X%. July growth that quarter at to of

the look like QX. the expect into head and second quarter at a in first August to much down June half we of step As about half to see X%. do X.X% will X% through and of We and July overall QX, we quarter the the very

excess as and XXXX peak industry more such on this the We see spill is capacity altering capacity it day in traffic than longer did no summer. up leisure-focused, Wednesday for later off-peak days, also usual as Peak days Saturday, lower-margin filling Tuesday, on travel airlines.

XXXX trends from XQ time negative. Latin that PRASM QX can third and unit We see quarter. expect expansion the QX, will declines data our the revenues going America we revenue were significantly Pacific the Deep do our good unit in forward. wave also since not look moderate first America fourth In stabilized and internal in But and have quarter, until remain strong for South lap Latin PRASM XXXX. to We do

unit fourth lap moderate is Growth Pacific for currently normal which the expect in headwind as quarter, will also return from China, and the year. we material region. also China's the end rates the During more we'll revenues a

continued into QX is continue road for elevated time the others popularity of for than in what QX growth stronger RASM level build at nonstop in We we heading expecting Mid-August seasonally for warrior we once expect revenues demand. to clearly better the some leisure also premium of race half United will, customers XXXX offer. unprofitable as in is we a see outperform many believe the coach the peaked Competitive capacity that less will of the unit United. overlap period cabin we're pivot on as and products again, of to routes which adjust second help QX, United flying point

booked it's for better clear half will are first. X quarter for revenue only in points the of for Unfortunately, this pivot currently August second QX. advanced of the believe in the pivot to that X United. our half beneficial Advanced be We data occurs PRASM about expected than the internal United to

the the quarter. revenue yield second encouraged be being. improvement in continue for We're So impacted the see time by half the booked we will the quality of to

capacity currently As year-over-year. what's domestic X.X% we industry that towards only On we to capacity based offered will QX, up off-peak be look flat X.X% days, on about for be could sale. estimate

domestic While Next planned that working, points approximately quarter. our in is to relative have basis the plan decided capacity fourth XXX cut results indicate United we of

half there While we within of offer the outside and macro the us into we RASMs many of see our amount second beyond. QX of it. help are is in accelerate issues QX This capacity control, will change

time to our did optimizing results. capacity similarly very what our week, of As QX successful increasing we in XXXX, which day was we by RASM QX published noted in of schedules, be day in in our and will relative

I'll our With discuss it results. and thanks great the that, to team Mike financial And for to say strong quarter details. industry-leading to United I'll with operational financial a hand over another

this work Thanks, you team thank and to busy hard all United the for Andrew, their season. summer of

second of quarter, delivered billion. the $X.X we In pretax income

to the by to Our profitability $X.XX earnings consistently managing earnings we in share deliver ahead business guidance. per In expectations, approach no-excuses performance. the of came continued on of our good maximize driven and to quarter, cost our

is solid capacity to The second industry. another the quarter despite some result headwinds

that Next been our our sustainably more business, that differentiated confident higher We've working. support successfully United never profitability. and have strategy is We will

up versus in quarter. costs, year-over-year year. to last Turning X.X% the X.X% the costs quarter fuel, second were on Unit excluding of capacity growth

second Our by X CASM-ex quarter performance strong driven factors. was

and over from the in our technology First, processes irregular operations. improved year, recover has their invested to operations better team

Our much lower than a these expectations. and expenses, to recover in events of similar we a more and crew-related leads CASM-ex point reliable are such is a seen as costs, improvements deadheading to in full operation faster premium X improvement The of XQ years. drove Notably, during more have approximately our more prior disruption compared impact own reliable ability to pay cost-efficient operation. operation,

to ensure hit Second, as the quarter, EPS throughout doubled we management yields expense guidance. we our on softened down

a guidance, to have improvement respect do in is the our specific These will quarter that. in achieve no-excuses with we the another what CASM-ex before, X.X to point we our we've As and hitting mentality versus actions led quarter EPS of to necessary discussed plan.

X.X maintenance were in approximately half events, the XXXX. of which associated be with of timing and likely second CASM-ex delayed will seen Finally, the point of is

the in the rationalization capacity we our the to our full Money-losing beginning both rapidly, to is confidence supporting industry for third mid-August. year. expect are look trajectory in take cut effect we and thus As third industry quarter, flights quarter being starting across

basis. Our system moderates second a X by capacity quarter the on points own third plan quarter year-over-year approximately versus

quarter capacity, for along to the be per makes this Andrew point to and revenue correct the quarter pressure year. the third impact for the the United, in earnings $X.XX backdrop reduction described, action the in CASM-ex CASM-ex for high with Altogether, range. While to Hurricane Houston, expect take share puts $X.XX with from that we our is this in Beryl on the third

accurate, immediately full fall this As which we that higher better-than-normal supply original you continue quarter, and expect. in per versus seasonal many earnings our a it's should improved do implies fourth QX do year, and, of range That's within point to that $X of expect $XX. with nothing balance everything for will realize therefore, the we and better and share. to significantly lead to seasonality, to profitability. with demand EPS I for to pattern what out the a QX yields It has between to

reiterate on to Andrew this, already like touched but I'd it.

our It's We and for capacity, schedules already aren't see and Despite the United in hoping you published for with moderating can industry reductions. supply. excess industry. own happened, XXXX. our it the industry management, demand it's product revenue clear, to remains one and airline other expect and with majority the cost of the profits strong, growth vast to disciplined United Coupled represent in industry expect we outperform we

Boeing On and the Airbus took X second the aircraft X fleet. we In AXXXneo delivery quarter, of aircraft. MAX

$X.X be in year. the to expenditures XX expect adjusted less now in deliveries with related years, We than aircraft XXXX. capital certain deliveries to total for billion we expect And movement PDPs future the of

also with capital to quarter, billion by the interest sheet interest outstanding invest voluntarily this the balance our in billion reduction Earlier term significantly had interest advantage we our prepaying took rate rate of $X.X near that balance the improve MileagePlus burden. almost reduces to $X this of we while generated high an XX%. position loan in business in This debt month, flow billion continuing $X.X cash free In of expenditures.

adjusted debt As of the of our was the X.Xx. net end quarter, EBITDAR to

I'm in second strong the encouraged our by performance quarter.

higher the as all hard the plan team about Next never our cylinders, Thanks our has to to our continues of the and to work, to demonstrated run evolving whole United adjust business. nimble remains trajectory confidence been on for team Our ability their an we've environment. United

start to Q&A. pass I'll it to that, With over Kristina the

Thanks, Mike.

the describe now will please analyst to the take We procedure ask [Operator questions from meeting. Instructions] question. Brianna, a

first question JPMorgan. with The Jamie Instructions] [Operator Baker from comes

First one for Andrew.

contract expect distribution to So is your what trend not early revisions experiencing look, what and how with of is sort of in and but partners, innings hearing, made paddling commissions some, corporate United seeing still you're the of you American back over last the year. some they that on thing. that corporate Curious and time, conversations all,

don't American a book to companies United first, force say believe Well, was agencies to windfall material we attempted Jamie. and Thanks, or sudden when disintermediate to there direct. I'd travel significant

again think American a there'll flops long-term this side. I really So don't be flip agencies to as and We've windfall maintained corporate with our partners. partnerships

come in and long-term what the currently I long-term are period, arrangements market revenue that sticky that to to United. we time they our made sure agencies And gain we did see the than of benefits that if put outlook. share our during think make and corporations currently actually more more the travel occurs. But current We'll this are actually to -- we in

So windfall a no sudden our their that result think was on we and it, to that United there's of as perspective change.

and error, industry But in Scott. Okay. use remains first now in fourth for Perfect. clearly And It second, the the tend maybe recovery forecast stalled just remove to best figures revenue AXA to and the GDP, then to metric this I this in quarter. just is looking quarter. stalled at

about could So if even growth past just trend below and that a post-COVID, fine. is we're to the consumer allow in think which this metric shapes how that's at possibility whether mobility all, perhaps pre-COVID your increased average. thinking you factors possibility or the the still exceed no that longer still I'm talked you wondering this it think into We've line. the about and pre-COVID

on Just topic? that any thoughts

geeky Well, economics a this'll little be XXX.

Bring it on.

Yes.

think I if back airline I time back. gets it not this is ratio what upwards. into to trend going think close, looked but absolutely, I'm is demand, sure of every history, declined. you you'd going will it capacity is ahead find where And and trend ratio the that, back revenue-to-GDP to went

was for analysis elasticity. Like demand up, inelastic. is demand skis and reason they of that demand So inelastic. But capacity, to is was project bit says Every factors I you revenue. lower at I that load analyst get over rush first that because they travel is is look their on prices It happens air the the overall when Airlines airlines at an get and on lowers very worked the elastic. American when estimating

as goes to so it So demand, ratio is surprised as really happen. see this exceeds and simple at down supply that when I'm not just all

response probably beginning rapid I my But career. today. the also capacity the times which response. see We'll the I've as fastest response cycles go to seen. of we been but between is with encouraged more It's mid-August, I the This many fast, is the incredibly am gap the that about ever call through airlines, through happening. is it I mean, fastest part in airlines talk think biggest and is response the I've reason the leading the so other these

So I expect to that close.

but I think think function purely capacity. I -- of a it's

Andrew from comes question Didora with of Bank next Our America.

probably could are First for night, question, out Scott. same. there There premium more do Alaska seating. announced reports Last the JetBlue

your Now on obviously, today, call certainly the premium a lot a discussion tailwind. strength on of

do you here? you Do United so trend can hold some think unique some product thoughts. feel most growth on your you away? can from RASM here? love Just Or will of would how this competed like to the premium think it you of Just of be is that it

the because is I'll and latest important, fad from. is not hub we on. airline operate a it's business try because to take off Andrew. it's to it's the core that United system start really but with I'll This premium first,

hubs are markets. in Our premium

Given and airline in few expanded or as with the us with seen similar one a new the cabins, it's we've cabins copying that are us others surprise no setup, days. success last other of

years been more copy implementing our from for a attempting hubs. something X challenge to earnest business operate anyone be not segmentation when think plan will we've than it's does in that for center I that

products, Our delivering simplicity, is segmentation of in on customer a built ULCC on not strategy model, along business built is service. excellent set complex with complexity. The particular,

they lead the term, about short in and premium Maybe bit concerned front the our as of little at generational not we're even all So flattered us. is others. is copy and our changes not a I'm belief

kind Mike -- the these help for come you in as quarter. execution it. And in the costs just expected? a -- And you see the out? just able understand nice these to cost very bit interesting. Got quick those revenues that coming of you're that Mike, than Very some a pull are levers timing-related? maybe permanently cost of are softer me Can kind question, Or little near-term of

Yes. It's a mixture.

As I -- the question. for and said thanks

operation said we is cost team As a great operational in thing in job. near the term, can the do has I the done call, efficiency a for the strong best and running

opportunities quarter right this the some have ops within and also. to timing-related. though, some simply tech those costs We In of were pushed

you will in see So XQ. pressure some

forward finalize. term, deals we some look CASM to around longer headwinds we're labor As of the include that looking

regional We frame, to That'll see expect time X-year future. headwind. to gauge and the uplift another over that also expect some work we a benefit against in flying the in X- so that's

And is our in demand. as premium spoke look, great product Andrew about,

will continue our even And revenue. in our And to add catering. we costs, add airports, investments so our those more to we make expect in product, but in

some So the those of are headwinds.

tailwinds, some no and to the on opportunity been see several tailwind gauge industry. idiosyncratic years, one have we that. in real from this continue for we And like an else of that but is we've Now

efficient skyline about And appropriately, efficient longer pattern, will loaded more a our us and spoke last growth. operation. which have aircraft. hire level maintenance we quarter, create to then a do sure to every now allowing expect we've going that I for allow term, for make more stable more As more is efficiently to growth staffed That's asset

a So the bit and of takes. little puts

real the a combined, lot changes. That of X pile to team, Officer, expense proof the to Mike, talked but irregular kudos other and a on irregular about happening, the with out. Ireland improvement like gotten we've of Chief mean, Information from to much there's is really one operations places identifying places structural of pull going Jonathan who's that that benefit Toby To Mike in and points. biggest this where of there's give you actually because Birnbaum, it's what cost them are here, Jason see the I the support our sitting I'm me, from in is permanent operations. opportunity technology with

And the have doing budget They're the great year. didn't doing didn't kinds realize a be. work successful of team that cost. team We that. should it that at would a of And just start I we lot solid We the have into we build those other a process really is things. like of how and for think

quarters, is we'll hit And did a so great in I while was spend example of that and the always it an that think lot that's something in we to less these operations that And than is come. permanent. irregular there's that past, on to more

next Conor Research. Cunningham with from Melius Our question comes

the longer think over someone the many into term to start us fear to going near be idea capacity buy term, going is I to but of is that cheat rationalized again. that can that the is

what's just structure if margin the plan has So United's capacity short slipped. reduction Clearly, are your term?

add at curious on from an a you're going point. But set that's looking supply just approach to to You're competitor of how some strength. always area playing

Well, let changes me as the said. start not and is off just the see with occurring, Scott my we I sustainable, capacity mean, unprofitable views.

this But and margins. the margins the But as and we normally did look same. question, you you liquidity pretax at think about

ever I the past today looking to back. about capacity the is health question your However, that even insightful in network competitors it's than more of come and think the different is how at answer been our will

that's my almost the today. the the XX% quartile is that a XX% for past, I the domestic of one any their airlines, the the really losses XX% carriers there's the by domestic-centric margins flying to also lower-margin higher-margin that's line new some largely very the like thing airline the We the lower-margin the estimate is magnitude interesting X magnitude don't is The to other the this worst given low-margin outcome is in flying, just others the worst the had these the business the occurred United. unprofitable. of worst severely never of negative the today. profitable view, overall at available or extremely unprofitable And least airlines In ASMs. no cases, and run plans, will airlines failing has Our way of airlines bad capacity for just never in growth this for point, opportunities shrinking of and have such dramatically -- flying. And been estimate think change from is in course. gap

you and really setup provides with us that or Exactly change occurs way. the that it's so backstop think different this is when worst and it's the on we capacity the like -- that magnitude a profitability, these only permanent when hard facts at will and feel quarter does to quartile of come And is But will environment, X, that a is it or very different to But its look the just back. slow time it X hopefully over tell. say. be next

capacity and Again, that happening like but be realize the annual early, know plan thought give environment but for process adjustments growth. called quarter, trying for could the what's current to today? 'XX plans, XXXX Has to X% United significant. X% implications it. the given not Next That's the actually changed, realize in you're for you're super helpful. fourth it's making then And I

as we of to going capacity really, going important, we're going We're right. we'll are improved continue that forward. to continue What with to we You're connectivity do United of some not guidance. -- was is improving to really give go Next, the and say fundamentals which

aircraft as The other mind rest compensate of size. the the the smaller XXX around United And kept of the narrow-body to today X that. We AXXX points and we're today, thing narrow-body short fleet. key to the large ingredients that. above But on aircraft Next in at that of to for United fleet one was is gauge of margin is bear operating with

really get their mix, already we have as one right our business competitors bullish plans. of And that the all to fleet we're in

push the in direction. continue to the We margins are to going right

in ask getting team, direction the the if double-digit achieve all the importance boat we're of commercial anybody in think they to the you realize same I a to rowing that. soon, and margin

with comes question Linenberg from next Our Deutsche Bank. Michael

it and that does X-point have that we on base? know in of The the kind domestic we Or on the pretty through already talked you that year. focused feel I come? move loaded what's guess quarter, about reduction question is one domestic. as Or good fourth a schedule? is on the capacity, I the the lot in

going for at We're not guidance QX give this point. to

our -- We we'll leave finalized QX it but at schedules, haven't that.

at And international. kettle too much pot from here. since black sure Lufthansa, about calling the headlines Airways, That's the times, have Andrew, although, making flipping I to a Okay. even you on, recently then, like seen over you've capacity, Qatar helpful. it I'm deal seems

of as of I what the realize you guess, competitively But move an coming -- great the do are over things of is from carriers I out time? And seeing some that European as internationally 'XX in some capacity lanes? a other traffic Is are Europe. carriers we as But what you influx of potential to that issue major to your from maybe move from Asian seeing 'XX?

cited the United And a question. that that to of It's good Sure. think I dynamic Asia-European one is that have not relevant now a airlines Airlines. obviously, lot really all

where are. negativity don't I translates to think So we through that

is we -- saying would been a do see and pivot. but a we've this I for what But say while,

we're prepandemic or Pacific year-over-year we First, single levels. have less up we to high in gotten And the were year, in going back be the Pacific, XX% this up capacity digits. more to last QX, as

about that bullish So obviously we're transition.

And then America. Latin

South to already pivot better. and pivoted America as America to do dramatically Latin in expect well and we has to positive, close

think, taking over pause a we did last over star It shining a year do to the plan. on results Clearly, are the others not and so, the said choose Atlantic. were have I worked. Atlantic, across again, of point then our is we And and

happy with to solid really good with profitability. Atlantic forward Atlantic. continues And look going so we're extremely The

fundamentally it was is overall, results international prepandemic, I and show than that. so think different the And

question next with Research. from Our Group comes Wolfe Scott

want of things. to Mike, clarify a just couple

comment a fourth had you -- implied guidance. Your about the quarter

Just feel we want sure midpoint should make to towards you like the of guide. year be full tracking the

half And second in to September. talked Delta a that in know the domestic the comment was RASM revenue unit expect leading the I guys performance release in inflecting says of have peers then positive among back about that there quarter. you

RASM exiting the you just be all think So quarter. you'll to want sure page, that I make same the on and on positive we're

the Well, let for I'll September talk And Scott. thanks about PRASM. question, Andrew

$X range this say in on more to per normal point I the earnings $X have I environment, would at so liked a range in a narrow. that's will that year, $XX, to share, that,

back You would said had January when we certainty have initially than we now to more expect it. in

timing But inflection is incredible us the the industry, to we see upon precise difficult while in this call. in magnitude

the fourth And to put current so and trends, the would full for at out the low year. the half yields, of the capacity, $XX on us quarter the as quarter, -- we third based end on $X the to in current published $X of based current lower look

expect there are further a ton us of push to But of reductions reasons to unprofitable flying higher.

range. committing that the so hit in wide. can had but something to very leaves left develops you range. we your the the And and where committing We're will deliberately to to own significant very deliberately And range data discussions estimate. we internally, want we read decide you to tea -- And are as all make the

so the that's PRASM confirm for point seeing positive I'll will think yes, September domestic X-point We we're this -- point. at going to just far. the based on hold. that We flip X- to do improvement I'll think

month We be quarter also worst will or just worst be year. the -- the probably will the the sorry, July year July for of

And for lower year. year? know thoughts billion don't any on $X.X thoughts Any than year. for higher, this know you early if have I Helpful. on similar then less next I next directionally or CapEx --

the we prior rebaseline me skyline. per would And today. I guidance. see think We're now that change nothing year cause XXX very targeting little that we change that from narrow-bodies our as to right

next Pfennigwerth comes from with Evercore Our question ISI. Duane

corporate. on Just

together, on last the recovered wonder into could your how and and a it were I basically view if corporate? the remind you basis, both here. incremental us you in of time improvement from serve on holding XQ. think I potential improvement in and about is, volume baked March thoughts talked terms on quarter revenue what's improvement on guidance a on in the Basically, we your

behind few we I a improvement. don't to thing rapid soon. it's GDP of a than points corporate that's otherwise recovered a more but think is anytime important most factor roughly see typical be relationship. on contribution The slow what relative to the XXXX. change steady Obviously, XXX%. is load a down And would far It's occurring

load in down transition this much it point, up happening. while, is on So a percentage Polaris months, as to smaller was slowly look, But it's demand example, and point it is business be -- the we last the a airplane. for we factor But a premium as we Polaris the leisure corporate. few leisure to found to a back take but going

to opportunities us prepayable. just as And coupon loyalty to next the pay took coupon debt, you a maybe opportunities loyalty was might high soon high down are you front? debt? X down be remind then as the that it what for debt What X Mike. Obviously, next on one Can

Thanks for the Thanks. question, Duane.

we're were in XX-month we mentioned at I X.Xx. Back at net trailing prepared now in remarks, XXXX, my X.Xx As debt-to-EBITDAR.

So really at balance reasons. on a We've for prepandemic-level good -- levels amount we're about those tremendous the of the sheet, sheet prepandemic got feel of already cash leverage. balance

We in We're and on of priorities the first drive are X buckets investing airplanes. investing X calls growth organic our Next. the to also all funding people. cash. United Those We're our in are

The third where and lot level to have to investor sheet deleveraging. is consider investor organic now we and further we balance is our some returns. the to a growth given And funding, are look call returns flexibility of on start to cash given start at of that

we'll of see mix a -- so And see that going forward. I

really, are debt more Thanks, prepayable that any the your just high we of near-term there to to coupon magnitude that opportunities instruments right There XX% such Specifically debt. that no like now question, are are prepaid. prepay Duane. are of no

Our next Sheila Kahyaoglu Jefferies. question comes with from

and made cabin. revenue or spread mix I Scott. the to one's maybe the unit of going between the this comment you premium performance a economy believe the Andrew, that you widen is for

comment your So on than slightly different made. the competitor premium

were basis. So I PRASM down actually premium your a on think revenues

how wonder help the more taking actions premium So are much cabin? with revenue that you guys of that Or is is economy to softening. management

cabin of contribution down, whether of and you part is yield was the give Plus The because up. by the obviously cabin. Economy of premium includes And was premium cabin. main I'll infiltrated the definition the the distinction. RASM main it RASM weakness Sure. Economy was that's The of Plus Economy Plus not. or

did and Polaris domestic the look it just and that contribution number you we first class, just saw. if low find and you would at resulted issue, that year-over-year. But up see digits was Premium single of And the in Plus you so that PRASM

Got following Okay. about Atlantic, that the maybe it. have could with maybe Apologies I is trends talk we Atlantic the regional Mike's that? for You On And sort oversupply Do how you that. of think, think around on, over see the don't up seem to the given quarters? about if world. issue? there? question X on do And same elaborate next wide-bodies that capacity you and the then Can dynamics and just that. we cabin fleet premium

think of last one I well, that an in quarters back proud quite our we, actually capacity month doing the so year-over-year, last year, of most did, the seen, better a we've Atlantic you frankly. go had again, and outcome to little Look, better we're if particularly bit think the -- create than And made right unbelievable to allocation we year, June of June. ever we're really competitors that. And unbelievable choices

for that's summer, European of Southern Europe, from year United, capacity is XX% Southern What end very careful combination our we're the I year, nature scheduled the has demand this limits careful Southern our schedules. performance, all just think, year-over-year fact. of to the way this through on the including And pretty good, the say published has with for year. I last darn a overall been given And and up continues which pushed plan to that the our is Europe. comp would But

the about going continue So good look the pretty to feel Atlantic that will we good setup forward.

Barclays. comes with Brandon Oglenski question next from Our

a just Mike, point of clarification here.

said $X Is quarters the of CapEx should in? narrow-body quarter that or billion ago, last anticipation be I you billion to aircraft baked $X deliveries range. that in think XXXX, with beyond X maybe XXX

correct. precisely That's

Okay. I or follow-up, here. appreciate mean, I And mentality maybe I for really guess my the Scott for for Mike. no-excuses

now, you quite just the But low, you that your can't think of little bottom think a outlook both I think I your of the next are you're flow. you Street hit I higher CapEx?" would you maybe investors both strategy, you on right below and see matching would you're I offset your could operating roughly that is EPS is, part on think I profitability for But below and capital year, that. guidance we as agree your challenge agree on and here think are less margins focusing what allocation cash if margins of more multiple here, targets because And last likes why I too. a realize And results. is line CapEx saying that investors "Hey, balanced bit well, some

capital are delays, XX investors that frustrated maybe bit a bit delivery with think spending more. issues, the a I little back you Boeing And the guys MAX little didn't off

for context many can in be So in should you and put that why so relatively aircraft taking beneficial? folks the future

to shareholders higher. from. where care value cash Thanks, over creating get free driving very XXX% flow about Brandon. We deeply I and appreciate multiple I driving that. shareholder the understand time. flow, cash you're our critical and Really free question, to coming It's

working. But is strategy Next our United

the relative haves the the that haves-nots, divergence and never the based on been margins, confidence Our it's between wider.

tunnel is. copied that premium drive wondering are light you coming much tunnel very -- is, position the and that with by not being a we're longer don't about competitors, our side So out a in to around of going That in strong competitive be and know the business emulated all margins. how bright, but is front us other exactly it's evidence that with can't it's front of in higher in moats product of very what the sunny day. and a a light We

is through. evidence going you're all is free pull cash us to increase, margins back. higher working, to therefore, for you're a see and see strategy those drive little have I'd as going our shareholders. ask more we're we flow, so going the as to not But And those returns patience that and to bit

James. question Our Raymond Savi with next from Syth comes

kind thinking about China you how think are this of stronger Just is kind earlier, is on Pacific where back any is different, mix there normal? made is was not be an -- Are Or opportunity And much realize notably there do lot the I to XXXX. that the on new just that in you kind to the this? of implications is Pacific mix like meaningful than But of a lower. there for China comments it change?

it's So overflight for it's and China of ability. of new is difficult the was fly lack I to normal. dramatically in Demand Russian XXXX, there the where also because than think it down

So those normal. X combinations new just the this make

Obviously, solid the And margin. China I to way. more Pacific think, capacity, we're -- is so negative prepandemic reallocated We've generating in capacity. I a back driven the think particularly we've has a by that adjust can to little to RASMs, funny. year, this to year-over-year caused after we'll Pacific definitely, a that later be China to fallen performance, lap and think, the QX. We normal I look beyond revenue as back numbers profitable

versus are a be hurting a Very different than last just why helpful. market. the I I'm maybe little players there And United you're it were of just maybe if what year, today and why composition it. can what kind domestic like lot curious domestic necessarily situation, but -- second seeing and half the bit the it seeing not capacity? just passenger the of it Like pain that second an overcapacity last half more didn't on a might Is in 'XX year? is of of Is really behavior? about Just ask -- Is you of pricing behavior? today. kind experience

along We've But growth I those Well, QX. our schedule it were in change our mean, period in a if we very hard of off issues didn't, so insulate and against insurance the that this changes not And yield to as you are changes, look quarter, Atlantic, a not plan. just And ourselves QX, changes during particularly in you all peak capacity industry. being from just QX, RASM it's with sound in in great it And QX. job significant just peak in less incredibly schedule pressured above, that. our of for effective the way worked a period the think particular that the all the made ourselves was XXX% I domestically sometimes effective, the that maybe in think at example insuring very said. it's did I changes

out only because taken I And into again, and that's think recipe RASM had industry it the how anybody QX we're of put for in by how out the expected think same United, QX, but excited and again, of changes has many not which, in the to even changed. in different reasons one this how remarkably we've don't it's I QX was more reacted industry of see itself I book the this flying that that extremely QX margins because think, it's time, negative in QX of year is, our than changing it it's competitors. turns And

So long that's simple a question. to answer very your, I think,

Morgan Shanker next Stanley. comes with Ravi from question Our

a Just still help that industry for would balance, didn't your of own push guidance plans. that how needs the here. range? to to top especially up of half much the a capacity you demand of quarter XQ sense supply want your couple to follow-ups fourth you know said of kind do have to get I to commit in the and capacity out But you come

little our can't is is I domestic X%. up sure. of a I for know expectation. you don't What below is approximately our -- A expectation or QX above little be capacity tell kind to would I

catalyst about and Understood. second sense Do Investor when clear targets. That's forward the hear Next one, kind it's for the be think I helpful. a stock, earnings of we'll looking kind for significant timing And that maybe long-term your pretty to more pretty the of a when and United are Day of that? updated the you of would that of as kind investors especially have

the working on We don't it. date thanks have We're scheduled yet. a Ravi, for question.

And later date. this back when We be are we if and still schedule finalize we'll targeting that year. and

comes Our with Fitzgerald Tom question from TD Cowen. next

business feedback you from media and wondering feedback have just from ramp. and little been the was to bit for been, a I that if about could talk connected customers what the timeline what the have brands

the there. in to Before answers to Helane. jealous her replaced Tom, this, wish She tells fill travels. since her of shoes you've big still don't the And I'll I me I Andrew? her best. I'm yes, book say, all know continue I question, Andrew use I Greenland. call in to already recommendations. me to but send she's can't Greenland, going she get Maybe conference she's if she's the hope listening.

earnings. connected things Great. announced. begun with one new that a media, to first, come from lot commercial up have that that to our discuss, but there's drive I book And a are important think we it's of and we connected On we here innovate is media on even things to always trying perspective, haven't

we really But lot be innovative. next going really will year, and to more We it meaningful Day. in the impactful expect a Airlines United going Investor forward. for discuss be going It's detail significant and ramp at to up it's a

about lapping in any And models? quick to a this Excited just fourth our more. in Okay. then one. quarter Aviv around we flying Tel hear should think the Is that there the year noise

I don't when it Aviv, we mean, think I Airlines. was it obviously United about of out, Tel pulled X% so.

that just number everybody. obviously, United, surprised think I its to the significant. it flying And least, for is was say lucrative and so loss

that's to on I intend going to service to And expand continue get flying the But resuming don't it to your and if for RASM, and we today. Tel colleagues, reestablishing double be our schedule. heart think Tel to we're we normal think of and Aviv is it question. drag back our we've a on worked safely daily Aviv

Our Mary Bloomberg question from call. We media with Schlangenstein the News. will to first now Instructions] switch the portion [Operator comes of

I'm low-margin to further the now that built their being demise given vocal their and they an in do about their Scott, taking airlines step that see fact ULCCs future on comment they're about seem that when or of as be whatever that model wondering, sort complicating their models speed is? originally pretty the the been extra industry. on views simplicity, you is the may earlier you've But your eventual the

it's Mary, Andrew.

wrong. Let Scott it, where and me me will correct take to try I'm

to think things of as the in ignored are And people on is first how all, have you not like set no-change fundamentally. With often what's the fees Economy, today. I when up Basic world of this they understand just I core think prepandemic. that going to you -- changed has in answer fact were kind

of and is, of playbook Scott I the what rundown you But give can add to a think it. kind I'll

to grow And previous generally face can of problem, quarters. to problem, in but this [ of just a well. recall called XXXXs, the this quite remember worked late I And type you I when cow time. for push Airlines usually at frankly, that the very when in airlines light something in we doesn't the happened I First, the was analyst. I back out it work. ] Continental regard this junior

markets where we is step well, picked different you next business think, noticed you're changes, right? is churn, than change something that. us. and airline the markets X the Then But is network we second The doing next We flying fix model wrong usually markets worse the set these is from today. of can

That's hard and slow. match. Let's really

does premium. think a occur I just well, everybody adjustment the few let's thinks, that is go that's that a next quarters. step But generational not over

then use it's because days but an do of then next schedule peak. then changes inefficient of And going assets. in your is changes just is is really on think and from because today you're And And one And a about the on. we lot concerned many the off And hard one capacity P&L the I schedule that's let's to and what's part shrink. our you months, competitors. closing last really see of push cut hard next closing good

make so complex simplistic, of to models a without adding think are it'll difficult costs. I lot very business And be these and

helps So the answer hopefully, that question.

to anything that? Scott, to add

is almost over. play The

you There go.

Financial Our next Claire question Bushey comes Times. from with

jets delays for emissions delivering How are worried carriers forced the are manufacturers for planes question older longer? Scott. new, a that as industry's to cutting is you This is by fuel-efficient hampering in more progress fly on

think that's don't the I issue. really

decarbonize is measured aviation to the airplanes across SAF sort sustainable is And I you the get how think the to way X%, fuel. get in Really, only XXX% ]. [ more improvement grain get goal of nice, of efficient to XXX%, our is getting but really kind that's industry. X% viable aviation and ultimately to a the which is sustainable to ability industry

investing industry where understand phases It's We're the That's is in the at world, the research. is leading today. the the an around why in It's now in investment. the we're aviation R&D. that's understand United in our point we've We It's commercialize that. It's chemistry. got built. nascent but fund. being technology, still -- this the We to United the

what is hard to our And critical so decarbonize to I on think that keeping eye really decarbonizing that otherwise an ball is industry.

for call back now Edwards will turn over to closing remarks. I the Kristina

everyone today. Please if you further and Thanks, any and Brianna, for Investor contact questions. Media thanks joining the Relations call have

talking next everyone Hope look and quarter. to a great summer, has forward

This you, Thank today's ladies conference. and gentlemen. concludes

You may now disconnect.