GO
Loading...

Enter multiple symbols separated by commas

JetBlue Swings to Profit, Lowers First-Quarter Guidance

JetBlue Airways forecast a loss in the first quarter on rising costs, after higher fares helped the budget carrier post a profit in the fourth quarter.

The seven-year-old airline, seeking to control costs, has reined them in by delaying deliveries of some aircraft and selling others. It has also raised fares at the expense of filling seats as it seeks to improve earnings.

These efforts helped JetBlue return to profit in the fourth quarter. But the results were slightly below analyst expectations, and JetBlue's shares fell Tuesday.

JetBlue, the No. 8 U.S. carrier by passenger traffic, posted a net profit of $17 million, or 10 cents a share, compared with a loss of $42 million, 25 cents a share.

The low-cost airline had been expected to post fourth-quarter earnings of 11 cents a share, according to a Thomson Financial consensus estimate, up from a loss of 19 cents a share last year.

Operating revenue jumped 42% to $633 million on a 14.5% rise in capacity and higher fares. Yield per passenger mile, a reflection of average ticket prices, rose 25% in the quarter.

The higher fares dented demand. Load factor -- a measure of the percentage of seats filled by paying passengers -- fell 1.4 points to 79.7%.

Despite the improvement last quarter, JetBlue guided toward a loss in the first quarter, forecasting a pretax margin of negative 4% to negative 2%. It said unit costs were expected to rise 6% to 8%.

Analysts expected JetBlue to post a profit of 9 cents a share in the first quarter, on average.

But the New York-based carrier expects a profit for the year, forecasting a pretax margin of 5% to 7%.

Contact U.S. News

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    Please choose a subscription

    Please enter a valid email address
    To learn more about how we use your information,
    please read our Privacy Policy.

Don't Miss

U.S. Video

  • Hero miles for military members: Real estate magnate's plea

    Chairman of the Fisher House Foundation, Ken Fisher, discusses the Hero Miles program with CNBC's Dina Gusovsky. During Military Appreciation Month, Fisher is asking every traveler to donate 1,000 of their miles to replenish the Hero Miles programs that is in danger of running out.

  • Cramer shuts down this market's haters

    "Mad Money" host Jim Cramer on why this market can't stop, won't stop.

  • From the battlefield to the boardroom

    Your Grateful Nation is dedicated to helping Special Forces veterans enter the corporate world and Knot Standard provides complimentary suits to vets. Mad Money's Jim Cramer spoke with Rob Clapper, Your Grateful executive director; John Ballay, Knot Standard co-founder and president; Tej Gill, retired U.S. Navy Seal; and Darren McB, active duty U.S. Navy Seal.