American Airlines lost $269 million in the third quarter, or 41 cents a share, even as revenue rose 19.3% to $16.3 billion. The bottom line: fuel ate the gain. Fuel expense rose $1.9 billion, or 67.5%, from a year earlier.
By the numbers
Revenue came in above the high end of the company’s guidance and, excluding the years after the pandemic, was the highest growth in its history. Premium revenue rose 22.9% and Main Cabin revenue 19.5%. Managed corporate revenue climbed 27.6%, the sixth straight quarter of double-digit growth. Total unit revenue was up 14.5%.
Strip out special items and the adjusted net loss was $182 million, or 28 cents a share. Investors will note that is only $71 million worse than the third quarter of 2025, despite the $1.9 billion fuel increase. American paid an average of $3.85 a gallon. It also reported the best unit cost performance among network carriers, with CASM-ex up 3.0%, and ended the quarter with $11.8 billion in total available liquidity.
The figure that matters: fuel
The fourth quarter looks harder. Based on the forward fuel curve as of October 19, American expects to pay about $4.70 a gallon, nearly double the price in the fourth quarter of 2025. That would add roughly $2.8 billion to fuel expense year over year. Revenue growth for the quarter is guided at 19.5% to 22.5%.
For the full year, American now expects an adjusted loss of $1 to $1.60 a share. In July its forecast ran from a loss of 65 cents to a profit of 65 cents. Because of the fuel price, network growth in 2027 will slow from 2026 levels.
Fares stay high
CFO Devon May told the Financial Times that airfares are likely to stay where they are even if oil falls. “If fuel comes down, I think airfares probably stay largely where they’re at right now,” he said. “If fuel prices go up, we need to generate higher yield, we need to generate higher fares to offset that higher fuel price.”
He also said ticket prices had not fully recovered in real terms since the pandemic, and that increases “ideally should have happened back in 2024, but the industry found itself in an oversupply environment.” In his words, 2026 was “the first year that everything came together” to push yields back to where they were seven years ago in real terms. The Bureau of Labor Statistics put airline fares up 22.4% in September from a year earlier.
Premium and loyalty bets
CEO Robert Isom said the investments across the airline’s four commercial pillars, which are customer experience, global network, premium revenue and loyalty, “are working,” and that he expects another quarter of record revenue growth to close the year. Premium passenger unit revenue rose 18.5%, against 14.4% in Main Cabin. Premium products generate roughly half of ticket revenue on about 30% of seats, and a narrowbody retrofit program is meant to lift premium seats on those aircraft to 40% in the coming years.
AAdvantage enrollments rose 27.4%, and card spend on the Citi co-branded partnership grew nearly 10%. Upsell from Basic Economy to Main Cabin improved by 6 points.
On October 8 American said it will install Starlink Wi-Fi across its entire mainline fleet, more than 1,000 aircraft. It expects to have achieved nearly $1 billion in annual run-rate savings from its reengineering work by the end of 2026.
Sources
- American Airlines
- American sets new revenue records amid historic fuel cost pressure
- American Airlines says airfares could stay elevated even if fuel prices drop
Photo: 4300streetcar (CC BY 4.0)
