American Airlines posts $545 million loss on higher labor costs while rivals post big profits
American Airlines is reporting a $545 million loss for the third quarter due to higher labor costs
American Airlines is reporting a $545 million loss for the third quarter in contrast with the huge profits posted by its two closest rivals.
American said its results were dragged down by $983 million in charges related to a new labor contract with its pilots, but United Airlines and Delta Air Lines reached similar deals with their pilots and still earned $1.1 billion each in the quarter.
Labor costs at American jumped 17%, an increase of nearly $600 million, which was roughly offset by lower fuel prices than a year ago.
American's revenue was roughly flat with last summer, compared with 12% and 11% increases at United and Delta.
American Airlines Group Inc., based in Fort Worth, Texas, said its earnings excluding special items worked out to 38 cents per share. Analysts expected 25 cents per share, according to a FactSet survey.
Revenue of $13.48 billion was slightly below Wall Street forecasts.
Shares of American are flat before the opening bell.
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