American sees return to profit on summer travel

American Airlines Group Inc. expects a return to profit heading into the busy summer travel season after bad weather and delays linked to air traffic congestion weighed on the carrier’s early-year results.

Adjusted earnings will be $1.15 to $1.45 a share in the second quarter, American said in a statement Thursday as it reported a loss for the first three months. The midpoint is above the $1.16 average of analyst estimates compiled by Bloomberg.

The outlook is an early sign that American’s postpandemic shift in strategy to focus on domestic and nearinternational routes may pay off. The carrier believes its Sun Belt hubs in the U.S. will benefit from a shift in population to states like Texas and Florida and its regional aircraft network can serve a broader base of smaller cities with little airline presence.

Capacity this quarter will climb as much as 9% from 2023, fueled by another summer of strong leisure demand and growing corporate and small business travel. Analysts were expecting 7.6% growth on average.

The carrier has largely sidestepped fallout from the crisis engulfing Boeing Co., which has slowed deliveries amid manufacturing issues and has struggled to get certification for overdue models. While American has purchased the delayed 737 Max 10, those aren’t scheduled to start arriving until 2028. Chief Executive Officer Robert Isom has encouraged the planemaker to “get its act together.”

Mr. Isom reiterated that message on a conference call Thursday with analysts, saying he has talked repeatedly with Boeing’s management.

“Get back to the basics — quality and safety are paramount,” the CEO said about the planemaker. “We’ll continue to work with them, do everything we can to support Boeing.”