Jet Blues

JetBlue posted a narrower-than-expected loss on Tuesday as stronger revenue partially offset skyrocketing fuel costs. Net loss for the quarter was $8 million, or 4 cents per share, compared with a net loss of $22 million, or 12 cents per share, in the same period last year.

Can this airline survive in an era of triple-digit oil prices?

"We are pleased with our strong unit revenue performance and cost discipline during the quarter," Dave Barger, JetBlue's chief executive, said in a statement.

Barger joins the panel for this conversation. Following is a summary of his main points on “Fast Money.”

Is your story all about the high price of oil?

“That really is the story,” replies Barger. “We’re looking at $118 million quarter over quarter just in additional fuel costs. We’re planning for a new normal," he adds. “Maybe $120 or $125 per barrel plus the crack spread built in as well. So we’re building a business plan to support that.”

You can make money with oil at these levels?

“We’re going to control growth, be smart about what we’re doing with revenue and the industry has to constrict,” replies Barger.

Will you raise fares?

"You can expect some higher prices but even in Q1 our average fare was $135 so we think the cost of air travel is still an affordable luxury,” answers Barger.

On Tuesday, JetBlue joined other carriers in adopting a new checked bag policy. Customers can check one bag at no charge but a second one will cost $20, effective for travel on or after June 1.

“We want to be careful about nickel and diming customers,” says Barger. “The new bag policy only applies to about 25% of our customers.”

Would you sell the company?

“We’re always going to evaluate any kind of offer that may come,” answers Barger, “but our goal is to make sure we have a strong balance sheet, liquidity and organic growth.”

Traders what do you think?

The business model is a difficult one, says Karen Finerman.

I like this CEO but unfortunately I think this stock is a sell, adds Jeff Macke.


Do you dare jump into airline stocks as oil reaches $120? We want to know. Answer the Charles Schwab Question of the Day!

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Trader disclosure: On Apr. 22, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Macke Owns (YHOO), (MSFT), (INTC); Finerman Owns (GS); Finerman's Firm Owns (DAI), (MSFT), (NYX), (TSO), (VLO), (YHOO); Finerman's Firm Is Short (IYR), (IJR), (MDY), (IWM), (SPY),(COF); Najarian Owns (AAPL), (ENER), (NOK), (TSO), (XLF), (YHOO), (EMC); Najarian Owns (BHI) Calls, (DD) Calls, (MSFT) Calls, (POT) Calls, (CHK) Calls; Charles Schwab Is A Sponsor Of "Fast Money"