UAL Q3 2024 Earnings

Call Details

• Call Title: United Airlines Holdings, Inc. Q3 2024 Earnings Call
• Date: October 16, 2024 at 2:30 PM UTC
• Management Team:
  • Kristina Edwards (Managing Director of Investor Relations)
  • Scott Kirby (Chief Executive Officer)
  • Brett Hart (President)
  • Linda Jojo (Executive Vice President and Chief Customer Officer)
  • Andrew Nocella (Executive Vice President and Chief Commercial Officer)
  • Mike Leskinen (Executive Vice President and Chief Financial Officer)
  • Toby Enqvist (Chief Operations Officer)

Call Summary

Financial Performance

• Consolidated revenue for Q3 grew 2.5% year-over-year to $14.8B.
• Consolidated TRASM was down 1.6% year-over-year in Q3.
• The company reported a pre-tax margin of 9.7% in Q3 and GAAP/non-GAAP EPS of $3.33, which exceeded the high end of the guidance range.
• CASM ex was up 6.5% in Q3 on 4.1% capacity growth versus Q3 last year.
• Q4 earnings per share are guided to a range of $2.50 to $3.00.
• Full-year adjusted capital expenditures were revised to be less than $6.5B based on current delivery assessments.
• Net leverage at quarter end was 2.7x with a stated target to reach below 2.0x over the next few years.
• Premium cabin RASM was up 2% in Q3 while MileagePlus revenue was up 11% year-over-year.

Guidance

• Q4 EPS guidance is provided at $2.50 to $3.00 per share.
• The company expects CASM ex to improve into Q4 and to decline further in 2025 versus the Q3 peak.
• There is an explicit downward bias to CapEx in 2025 due to aircraft delivery delays at OEMs and the Boeing strike.
• The company expects an RASM versus CASM inflection in calendar year 2025, with a belief that RASM growth will outpace unit cost declines that year.
• Net leverage is being targeted to fall below 2.0x over the next few years as profitability and free cash flow improve.
• Management expects the $1.5B repurchase program to be funded by free cash flow and executed beginning this quarter and through 2025.
• More precise CapEx and capacity guidance will be provided on the January call, per the commentary on the call.