JetBlue posts quarterly loss but forecasts profit thanks to strong travel demand

JetBlue Airways posted a loss for the first three months of the year but joined other carriers in forecasting a profit for the second quarter thanks to strong travel demand.

JetBlue estimated per-share earnings of 35 cents to 45 cents for the current quarter, ahead of analyst estimates, with revenue up 4.5% to 8.5% on the year and capacity up 4.5% to 7.5% from 2022. The second quarter coincides with the start of the peak travel season.

"For the second quarter, we expect strong revenue growth to continue as demand remains robust and as we see continued momentum from our commercial initiatives," CEO Robin Hayes said in an earnings release. "We are forecasting a solidly profitable quarter, and we remain confident in our full-year earnings outlook."

The company's shares were up about 1% in morning trading Tuesday.

Here's how JetBlue performed in the quarter ended March 31 compared with Wall Street expectations based on Refinitiv consensus estimates:

In the first three months of the year, JetBlue lost $192 million, or 58 cents a share, an improvement from a net loss of $255 million, or 79 cents per share, in the same quarter of 2022. Revenues jumped 34% in the first quarter to $2.33 billion, slightly ahead of estimates. Average fares rose more than 9% in the quarter from 2022 to $214.07.

However, expenses rose more than 22% to $2.57 billion, with the fuel bill alone up 34% from a year earlier.

"We need to continue to find ways to keep our costs in check, which is fundamental to our business model of offering low fares and a great product, so we can have sustained profitability," CFO Ursula Hurley said in a staff note on Tuesday, after the company reported results.

JetBlue's CEO told CNBC last month that the carrier is among the airlines that plans to cut back some of its schedule in the New York area this summer because of a shortage of air traffic controllers, part of a plan with the Federal Aviation Administration to reduce congestion.

"Even with these actions, we still expect challenges in the operating environment this summer so it'll be extra important to work together to deliver a great JetBlue experience," Hurley said in Tuesday's staff note.

Adjusting for one-time items, JetBlue had a loss of $111 million, or 34 cents per share, better than the loss of 38 cents a share analysts expected.

The New York-based airline struck a deal to buy budget carrier Spirit Airlines in July for $3.8 billion in cash, but the Justice Department sued to block the acquisition last month.

The Justice Department has also sued to undo JetBlue's partnership with American Airlines in the Northeast, but a judge has not yet ruled in that case.