American Air Rebounds on Gain in Bookings and Slowing Cash Burn
(Bloomberg) -- American Airlines Group Inc. bounced back from Thursday’s drubbing after the carrier said net bookings have been positive since the first week in May, showing “continued signs of improvement.”
- Second-quarter revenue will be down about 90% from a year earlier, the airline said in a regulatory filing Friday. The projection was in line with Wall Street estimates as compiled by Bloomberg.
- American also offered a rosy projection for spending, saying it expects to reduce its daily cash burn to zero by year-end, although that’s predicated in part on improving travel demand. The carrier’s expected cash burn is $40 million a day for this month.
- The Fort Worth, Texas-based carrier recently joined rivals by adding flights for July, responding to rising domestic demand as states began lifting quarantine restrictions. The carrier’s average number of passengers has increased to 129,000 a day from 31,000 in April.
- American said it would pledge “a significant portion” of its loyalty program, valued at as much as $31.5 billion, as collateral to secure a $4.75 billion federal loan.
- American jumped 17% to $16.82 at 9:44 a.m. in New York, recovering from a 16% plunge during Thursday’s broad rout. The stock had tumbled 50% through Thursday, while the S&P 500 fell 7.1%.
- Additional coverage
- Company filing
©2020 Bloomberg L.P.