DALLAS — American Airlines (AA) has reported strong financial results for the second quarter of 2023, achieving record-breaking revenue and demonstrating optimal operational performance.
During Q2 2023, AA recorded a record quarterly revenue of US$14.1 billion, representing a significant 4.7% increase compared to the same period in the previous year. The company’s net income for the second quarter was US$1.3 billion, translating to $1.88 per diluted share. However, excluding net special items, the net income stood at $1.4 billion or $1.92 per diluted share.
One of the key highlights of the quarter was the remarkable cash flow generation. The company reported an operating cash flow of US$1.8 billion and a free cash flow of US$1.2 billion during this period. Moreover, AA managed its liquidity effectively and ended the quarter with total available liquidity of US$14.9 billion.
The company achieved its best-ever second-quarter and controllable completion factors, reflecting its commitment to running a reliable operation. AA and its regional partners operated nearly 500,000 flights in Q2 2023, with an impressive average load factor of approximately 86%.
The Memorial Day weekend and June were particularly noteworthy for American Airlines, as they both saw record-breaking completion factors despite facing challenges related to weather and air traffic control. The airline’s April, May, and June controllable completion factors were the best, and it recorded 11 more combined zero-cancellation days compared to the same period last year.
Our operation is performing at historically strong levels, and we have worked to refresh our fleet and build a comprehensive global network, all of which helped to produce record revenues in the second quarter. We will build on this momentum the rest of the year and continue to prioritize reliability, profitability, accountability and strengthening our balance sheet.Robert Isom, CEO of American Airlines
American Airlines also showcased a strong financial comeback, returning to profitability in the second quarter. The robust revenue performance was primarily attributed to continued broad-based demand strength and the company’s excellent completion factor performance. Notably, demand surged in June due to an increase in close-in bookings. The domestic and short-haul international revenue performed well, while there was significant strength in long-haul international demand and yield performance.
The company has been actively focusing on strengthening its balance sheet, reducing total debt by $387 million during the quarter. As of June 30, 2023, AA has reduced its total debt by approximately $9.4 billion from peak levels in mid-2021. The commitment to improving the balance sheet has been recognized by the credit rating agency Fitch, which upgraded the company’s credit rating two notches to B+.
Featured image: American Airlines Boeing 777-200ER N766AN. Photo: Dominik Csordás/Airways