American Airlines (AAL), the world’s largest carrier, has lowered its sales and profit guidance as it grapples with a continued slowdown in business travel.
The Fort Worth, Texas-based company also announced that Chief Commercial Officer Vasu Raja is leaving the company in June of this year.
News of the lowered guidance and executive departure sent American Airlines’ stock down 8%.
The carrier said that it expects unit revenues to decline 6% in the current second quarter from a year earlier. That’s down from a previous forecast of a 3% decline.
American Airlines also reduced its earnings estimate to a projected range of $1 U.S. to $1.15 U.S. a share. That is down from a previous range of $1.15 U.S. to $1.45 U.S. per share.
The company blamed the lowered guidance on a decline of corporate customers and business travel, something it has struggled to reignite since the end of the Covid-19 pandemic.
Chief executive officer (CEO) Robert Isom has said that American Airlines plans to modify its ticket distribution strategy to drive bookings to its own platforms instead of third-party channels.
Vasu Raja is leaving the airline a little more than two years into his role as commercial chief. He
previously served as chief revenue officer at American Airlines.
Prior to today (May 29), the stock of American Airlines had declined 8% over the last 12 months and was trading at $13.44 U.S. per share.
