JetBlue Airways effectively capitalised on the IT-related struggles of major US airlines that were forced to cancel thousands of flights starting in late July, boosting its third-quarter revenue projections.
The unexpected surge of air travellers rebooking flights cancelled by Delta Air Lines and United Airlines is partially why JetBlue released on 5 September less-gloomy revenue guidance for the July-September period. It now anticipates third-quarter revenue to land between a 2.5% decrease and a 1% increase over the same three months of last year.
That compares to its previous guidance of a year-on-year decline of 1.5%-5.5%.
JetBlue says it has benefited from ”several factors, including improving in-month bookings, particularly in the Latin region, and continued progress from its previously announced $300 million worth of revenue initiatives”.
“The company also recognised revenue uplift from the reaccommodation of customers affected by other airlines’ cancellations due to technology outages in July,” it adds.
Though United was initially hit hard by the outage caused by CrowdStrike’s faulty software update, it recovered more quickly than Delta, which went into an operational tailspin and cancelled more than 7,000 flights. Delta estimates the episode cost it about $500 million.
New York-based JetBlue has been dealing with troubles of its own. The carrier is in the process of reducing capacity and shrinking its network as part of a financial turnaround plan called “JetForward”, with growth appearing unlikely for the next several years.
In July, the carrier said it has delayed deliveries of 44 Airbus A321neos into next decade, meaning the airline does not anticipate receiving any of the narrowbody jets between 2026 and 2029.
And the carrier’s existing fleet is among those affected by Pratt & Whitney’s recall of hundreds of geared turbofan (GTF) engines.
JetBlue has 13 aircraft in storage, according to Cirium’s fleets analyser. That includes seven A321neos and six Airbus A220s, all of which are powered by GTFs.
A stronger-than-anticipated third-quarter performance would be welcome news. JetBlue’s expenses have declined more than expected, with fuel prices moderating as the quarter has progressed. It now expects third-quarter fuel prices of $2.70-$2.80 per gallon, compared with its previous guidance of $2.82-$2.97.
Additionally, JetBlue says its operations were relatively smooth during the US summer travel season, as its on-time performance improved by 10 points, year on year.
