American Airlines sees sunnier skies ahead.
The carrier’s outlook issued Tuesday projects a quarterly loss that’s smaller than what analysts expected. American is betting that an increase in flight demand for the holidays and a lifting of travel bans will boost bookings for the rest of the year.
That’s a sharp turnaround from the tempered outlooks airlines had earlier issued as the Delta variant slowed bookings and drove up cancellations. American now says it is planning for what it called a “robust” peak travel period. A recent fall in infections has lifted hopes that passengers would become confident enough to board planes again.
What’s more, the Biden administration plans to reopen the United States next month to European travelers. That lucrative trans-Atlantic route accounted for a sixth of passenger revenues two years ago at the U.S.’ three largest carriers.
Despite that optimism, American sees quarterly revenue falling short of the level achieved in pre-health crisis 2019 by 25%.
That didn’t keep investors from bidding up shares of American in early trading Tuesday.