JetBlue Joins Chorus Of Airlines Warning About Slipping Demand

We just lately penned an article titled “Airline Stocks Encounter Turbulence as Alaska Air Indicates Waning Demand,” adopted by “Air Travel Bubble Might Be In A Stall.” Now, a number of US airline carriers are warning a few deceleration in home air journey demand. 

JetBlue Airways Corp. is the newest to slash its full-year revenue forecast over indicators of sliding US journey demand: 

“We are updating our full-year earnings outlook to reflect near-term headwinds related to the termination of the NEA, a challenging operating environment in the northeast and a greater than expected shift of pent-up Covid demand to long-haul international markets which is pressuring demand for domestic travel during the peak summer travel period,” President/COO Joanna Geraghty wrote in a press release. 

“The guidance is extremely disappointing,” Helane Becker, a TD Cowen analyst, instructed shoppers. 

Becker continued, “The current revenue environment where domestic fares are trending lower is driving the big reduction in earnings expectations.”

JetBlue stated it might earn much less as a result of sliding demand within the third quarter than analysts anticipated. It joins Alaska Airlines and Southwest Airlines, who warned final week about waning demand. 

According to tech agency Bloomberg Second Measure, which tracked credit score and debit card transactions made with airline carriers, reminiscent of Delta Air Lines, American Airlines, United Airlines, Southwest Airlines, Alaska Airlines, and JetBlue, card knowledge for the second quarter confirmed a decline throughout all carriers tracked for the primary time since Covid. 

This could be an early signal that ‘revenge journey’ has handed the height, and customers are lowering journey, like different discretionary purchases, together with electronics, attire, and eating places, as monetary circumstances tighten. 

In a separate word, Bloomberg believes airways danger a tough touchdown after the summer time journey surge: “Jam-packed airports, elevated ticket prices and cheery commentary from corporate executives all pointed to strong demand for air travel this summer, helping airline stocks stage a torrid rally heading into the second-quarter earnings. But the road ahead now is starting to look bumpy now.”