• Revenue: Increased 5.4% to a record $13.2 billion for Q1 2025.
• TRASM (Total Revenue per Available Seat Mile): Up 0.5% for the quarter.
• Domestic Main Cabin RASM: Down 5% year over year.
• Premium Cabin Unit Revenues: Up mid-single digits.
• International Polaris RASM: Up 8%.
• International Premium Plus RASM: Up over 5%.
• Domestic Premium Seat RASM: Flat year over year.
• Loyalty Revenue: Grew 9% to $1.5 billion.
• Earnings Per Share (EPS): $0.91 for Q1 2025.
• Pre-tax Margin: 3%, up 3.6 points year over year.
• CASM-ex (Cost per Available Seat Mile excluding fuel): Up 0.3% year over year.
• Liquidity: Ended Q1 with $18.3 billion, including undrawn revolver.
• Free Cash Flow: Generated over $2 billion in Q1.
• Debt Reduction: Paid down $1 billion of debt in Q1.
• Net Leverage: Reduced to 2.0 times from 2.2 times at the end of 2024.
• Share Buyback: Repurchased approximately 5.6 million shares in 2025 at an average price of $80.

• Warning! GuruFocus has detected 3 Warning Sign with UAL.

Release Date: April 16, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• United Airlines Holdings Inc (NASDAQ:UAL) achieved the highest first-quarter pre-tax margin since COVID began, demonstrating strong performance even in a weaker economic environment.
• The company has won brand-loyal customers, leading to resilience in earnings and financial metrics.
• United Airlines Holdings Inc (NASDAQ:UAL) is investing in customer experience enhancements, such as new clubs in Houston and San Francisco, and installing the fastest Wi-Fi with Starlink.
• The airline reported a 5.4% increase in top-line Q1 revenue to a company record $13.2 billion.
• United Airlines Holdings Inc (NASDAQ:UAL) has a strong liquidity position, ending the first quarter with $18.3 billion in liquidity and generating over $2 billion of free cash flow.

Negative Points

• The softer macroeconomic environment is causing volatility in the market and softer demand for travel.
• Domestic main cabin RASMs were down 5% year over year, impacting revenue expectations.
• There is a reasonable chance that bookings could weaken further, potentially affecting future earnings.
• United Airlines Holdings Inc (NASDAQ:UAL) is facing challenges with non-US-origin passenger volumes, which are down in certain regions.
• The company has had to adjust RM strategies to accommodate more lower-yield passengers, impacting yields.

Q & A Highlights

Q: Presumably this past January, you had an internal forecast for 2026 earnings. If we embrace something closer to the recessionary scenario that you just laid out, would your internal 2026 forecast be higher, lower, or the same today? A: (Scott Kirby, CEO) In a normalized back-to-growth economy, our margins would be higher. We've been focusing on decommoditizing United into a brand-loyal airline, cost convergence, and revenue diversity. These structural changes mean that United Airlines is likely to have higher margins, even in a recessionary environment.

Q: Your premium high-margin competitor refuses to buy back stock until they meet their leverage targets. Why have you been active in repurchasing shares? A: (Michael Leskinen, CFO) We are optimizing our overall cost of capital. As our stock price declines and the gap between market price and intrinsic value widens, it becomes more opportunistic to buy back shares. We are disciplined about ensuring buybacks are funded by free cash flow and not debt.

Q: Can you speak to additional cost levers you have if the revenue environment starts to move towards your recession scenario? A: (Michael Leskinen, CFO) We are focused on building a cost-efficient culture, improving procurement, and leveraging technology. Running a reliable operation is key to low-cost operations and winning brand-loyal customers. We expect better CASM-ex for the full year than initially thought and will continue to find efficiencies.

Q: How do you think about balancing the use of your margin advantage? Are you thinking about using that margin to take share or protect it? A: (Scott Kirby, CEO) There is no tension between taking share and protecting margins. The brand-loyal airline has always won, and our strategy hasn't changed. We focus on creating the best airline for United customers, which naturally leads to a competitive advantage.

Q: How do you define brand-loyal customers, and how can it be measured from the outside? A: (Andrew Nocella, CCO) Brand loyalty can be measured by market share in hub cities, origin market share, and share among global travel agencies. Our market share is up in every hub city, and our loyalty program is strong, contributing to our margin advantage.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.