American Airlines withdrew its 2025 profit forecast on Thursday, as concerns over discretionary budget amid tariff pressures and government spending uncertainties make it difficult for carriers to predict travel demand.
U.S. President Donald Trump's trade policies and sweeping tariffs have sparked a global trade war and raised the odds of the world spiraling into recession, making customers hesitant to spend on travel.
The economic downturn is creating headwinds for major U.S. airlines, which, just two months ago, were benefiting from strong travel demand and solid pricing across their networks.
With travel being a discretionary expense for many consumers and businesses, growing economic concerns have clouded the outlook for the airline industry.
American Airlines is also reeling from higher costs associated with expensive labor contracts signed last year.
The legacy carrier reported a net loss of $473 million, or 72 cents per share, for the quarter through March, compared with a loss of $312 million or 48 cents per share, a year earlier.
It had earlier forecast an annual adjusted profit per share of $1.70 to $2.70.
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