American Airlines has readjusted its third-quarter earnings forecast, and for the better.
The carrier now estimates that Q3 will see a smaller-than-expected adjusted loss after initially setting its losses to be much higher, according to Reuters News Service.
Most domestic airlines had the same outlook when it appeared that COVID-19 cases would be on the rise again this fall. But cases have dropped in recent weeks, and a pent-up demand to travel continues.
In addition, the Biden administration's plan to reopen the United States in November to air travelers from Europe has added to the optimism. The trans-Atlantic route is one of the most lucrative ones in the world and accounted for up to 17 percent of 2019 passenger revenues for the big three U.S. carriers, according to Reuters.
American's rival, Delta Air Lines, posted a Q3 profit when it announced earnings this morning.
American expects net loss, excluding items, to be between $620 million and $675 million in the third quarter. Analysts on average expect a loss of $741.7 million, according to Refinitiv data.
But between a potential difference of $100 million less in losses and its optimism over the upcoming holiday travel season, American is buoyed by the future.
The airline said it was "planning for a robust peak travel period in the fourth quarter."
American will announce Q3 earnings on October 28.
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