United Airlines (UAL) Q3 2024 earnings summary

Executive summary

• Achieved record third quarter with highest-ever passenger volumes, strong operational performance, and top on-time rankings among major U.S. airlines; customer satisfaction and NPS scores improved due to investments in experience, technology, and training.

• Net income for Q3 2024 was $965 million, down 15.1% year-over-year, with operating revenue up 2.5% to $14.8 billion and operating expenses up 4.2% to $13.3 billion; pre-tax margin reached 9.7%, and adjusted EPS was $3.33, exceeding guidance.

• Announced a $1.5 billion share repurchase program, with $82 million of shares already repurchased to offset warrant dilution.

• Corporate revenues grew 13% year-over-year in September; premium revenues up 5%, Basic Economy up 20% year-over-year.

• Salaries and related costs increased 10.4% year-over-year, reflecting wage increases and a 4.4% rise in headcount; fuel expense fell 10.4% due to lower prices despite higher consumption.

Financial highlights

• Third quarter revenue grew 2.5% year-over-year to $14.8 billion, with capacity up 4.1%.

• Operating income was $1.57 billion, down 10% year-over-year; adjusted net income was $1.1 billion.

• Diluted EPS for Q3 2024 was $2.90; adjusted diluted EPS was $3.33, ahead of guidance.

• Free cash flow for the quarter was $3.44 billion year-to-date; ending available liquidity stood at $17.1 billion.

• CASM-ex increased 6.5% year-over-year, impacted by capacity reductions and external events.

Outlook and guidance

• Q4 2024 adjusted diluted EPS is estimated at $2.50–$3.00.

• Anticipates margin expansion over the next three years, driven by industry capacity rationalization and improved business travel demand.

• Expects CASM-ex to decline in Q4 and further into 2025, with RASM outpacing CASM in 2025.

• Full-year adjusted capital expenditures projected below $6.5 billion, with 2025 CapEx expected to have a downward bias due to aircraft delivery delays.

• Targeting net leverage below 2x in the next few years.