United Airlines slashed its aircraft delivery expectations for the year as a federal safety review and the delayed arrival of a key airplane model slow the carrier’s near-term growth.
The Chicago-based airline intends to take just 61 new narrow-body planes this year, the company said Tuesday in a statement as it revealed better-than-expected quarterly results. That’s down from a prior plan of 101 jets and an original expectation of as many as 183 aircraft. The change will cut United’s capital outlays by about $2.5 billion this year to $6.5 billion, the company said.
The revised order book shows the dramatic steps United is taking as it grapples with challenges including the delayed arrival of a key Boeing Co. model. The airline is also under scrutiny from U.S. aviation regulators following a series of safety incidents. United already has delayed the start of two new routes under restrictions that are part of the review, and Bloomberg reported last month that it also may face limits on introducing new planes into service.
Despite the hurdles, United’s second-quarter performance is trending better than Wall Street had expected. The company on Tuesday forecast an adjusted profit of $3.75 to $4.25 a share this quarter, topping the $3.73 average of analyst estimates compiled by Bloomberg.
The shares rose 5.1% as of 4:08 p.m. Tuesday after regular trading in New York.
As part of the revamped aircraft delivery plan, United said it reached deals to lease 35 Airbus SE A321neo aircraft that will begin flying in 2026 and 2027. The announcement confirms earlier Bloomberg reports that the carrier was in talks to add the hot-selling Airbus narrowbody as it makes up for Boeing 737 Max 10 deliveries it pulled from plans this year because of repeated delays.
The carrier also said it will convert some Max 10 orders to the smaller Max 9 variant. United now expects to take an average of 100 narrow-body aircraft each year from 2025 through 2027, it said in a statement.
United beat expectations for the first quarter with an adjusted loss of 15 cents a share, better than the 57-cent average loss estimated by analysts. Revenue of $12.5 billion also topped estimates.
The grounding of Boeing’s 737 Max 9 aircraft resulted in about $200 million in lower revenue and higher costs, United said. United is the largest operator of the plane, which was grounded by U.S. regulators for about three weeks in January after a fuselage panel flew off an Alaska Airlines plane during flight.
— Mary Schlangenstein for Bloomberg
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