Q3’24: United Records $1.3bn Pre-Tax Earnings

United Airlines (UAL) reported third-quarter 2024 financial results showing that the company had pre-tax earnings of $1.3 billion, with a pre-tax margin of 8.7 per cent; adjusted pre-tax earnings1 of $1.4 billion, with an adjusted pre-tax margin1 of 9.7 per cent.

The company also achieved diluted earnings per share of $2.90; and adjusted diluted earnings per share1 of $3.33, ahead of the third-quarter 2024 guidance provided at the start of the quarter of $2.75 to $3.25.

To show its strength in the global airline industry, the company produced strong financial and operational results in the quarter. As the company expected, revenue trends improved as the industry reached an inflexion point in the quarter with unprofitable capacity exiting the market.

Domestic unit revenue was positive year-over-year in August and September. Demand continues to be strong for the United product.

Corporate revenues were up 13 per cent year over year in September, and in the quarter premium revenues continued to remain resilient and were up five per cent year over year and revenue from Basic Economy was up 20 per cent year over year.

United Airlines CEO, Scott Kirby, said: “I appreciate the entire United team coming together to take care of our customers by operating a safe and on-time airline this summer.

“As predicted, unproductive capacity left the market in mid-August, and we saw a clear inflexion point in our revenue trends that propelled United to exceed Q3 expectations.

“A prosperous summer 2024 is just the beginning as our improved customer experience combined with United Next positions the airline at the top of the industry for the foreseeable future.”

The company’s Board of Directors authorised a new share repurchase programme for up to $1.5 billion of outstanding shares of common stock and warrants originally issued to the U.S. Treasury under the CARES Act and Payroll Support Program, subject to a limit of $500 million in aggregate through year-end 2024.

This amount represents approximately seven per cent of the company’s market capitalisation based on the closing stock price on Oct 14, 2024.

This amount represents approximately seven per cent of the company’s market capitalisation based on the closing stock price on Oct 14, 2024. This is the first share repurchase program since the suspension of the previous program in 2020 due to COVID-19.

Unless suspended or terminated earlier by our Board of Directors, this programme has no set expiration date and will, therefore, terminate when the company has completed all purchases authorized under the programme.

“In the last four years, we’ve invested $22 billion in our product and nearly $10 billion in our people. Those investments have enabled higher profits and are now contributing to growing free cash flow,” said United Airlines CFO, Michael Leskinen.