United Airlines on Tuesday reported “strong and steady domestic demand” and profits for key international markets at “record highs.” But it also broke out the potential business impact of a continuation of the Israel-Hamas war.
Overall revenue in the third quarter rose 12.5%, with domestic revenue up 8.7%. “Domestic revenues in the quarter were second highest all-time and the domestic system remains solidly profitable,” the company said.
The airline’s international passenger revenues were up 23.6% year-over-year.
United, which has suspended flights to Tel Aviv, said a continuation of the war in Israel would reduce its forecast for revenue and earnings.
If flights resume after October, the airline said it expects to earn about $1.80 per share in the fourth quarter. If the war continues and flights are suspended for the rest of the year, earnings could drop to $1.50 per share.
Revenue growth would drop to about 9% if the war continues – down from 10.5% if suspensions last only through October.
Regardless of the length of the war, United is expecting its average aircraft fuel price per gallon to be $3.28 in the fourth quarter, up from $2.95 in the third quarter. United updated its third-quarter guidance in September to reflect a more than 20% rise in fuel prices since mid-July.