JetBlue Cuts Forecast as Travel Demand Slump Intensifies

JetBlue Airways Corp. has withdrawn its annual financial forecast and indicated that the decline in air travel demand is likely to intensify due to the deteriorating consumer confidence caused by President Donald Trump’s trade disputes.

A sudden downturn in demand for trips during the first three months will extend into this quarter, fueled by worried consumers and concerns about the broader economy, JetBlue President Marty St. George said in a statement. Unit revenue, a measure of fares and demand, could fall as much as 7.5% this quarter, JetBlue said.

Reducing air travel risks derailing CEO Joanna Geraghty’s strategy for returning the carrier to profit. JetBlue primarily concentrates on domestic routes, notably within the northeastern U.S. and along the East Coast—regions severely affected by the downturn.

“Given the current economic uncertainties, we are choosing not to reaffirm our previous annual projections,” Geraghty stated in a release as JetBlue outlined its first-quarter financial performance.

The airline independently stated that it anticipates unveiling a fresh partnership deal later this quarter following the collapse of negotiations with American Airlines Group Inc., aimed at resurrecting part of their collaboration in the northeast region of the U.S. This previous arrangement had been halted by a federal court ruling due to alleged violations of antitrust regulations. In response, American has filed legal action against JetBlue seeking compensation for funds claimed to be due from the dissolution of their prior cooperation, primarily centered around routes serving Boston and New York City areas.

Teaming up with another carrier might assist JetBlue in tackling a progressively tough landscape. By 1:41 p.m. in New York, JetBlue’s shares were up by 4.3%. The company’s stock price had plunged 48% since the start of the year until Monday’s closing, which is significantly more than the S&P 500 Index’s drop of 6%.

JetBlue had already been reducing its flight operations.
capacity
On days with lower demand in March and April, they cut back operations in 20 urban areas. During these months’ busiest periods, revenue per mile traveled per seat increased by a high single-digit percentage from the previous year; however, this figure dropped by double digits during quieter travel times, as St. George mentioned during an analyst and investor conference call.

“Similar to its competitors, JetBlue is facing adverse public opinion due to increased overall economic unpredictability,” noted TD Cowen analyst Tom Fitzgerald in a statement.

JetBlue has also discontinued the scheduled daily flights between Boston and Halifax, Nova Scotia. This new route—JetBlue’s first to be terminated prior to commencement of services—was slated to begin in June. However, the airline abandoned the flight after travel from Canada to the U.S. significantly decreased earlier this year.

“It simply wasn’t going to be beneficial for us in the near future, so we decided it would be best to remove the Band-Aid quickly and proceed,” St. George stated.

The firm is contemplating further reductions in capacity and might decrease the count of older planes within its fleet. An optional early retirement scheme for pilots will wrap up during this quarter.

The expense to fly each seat for one mile, which measures operational efficiency, might increase up to 8.5% compared to last year during this quarter. This indicates that the airline is still facing challenges in managing costs effectively.

A short-term benefit is that JetBlue does not anticipate a “substantial effect” this year due to the tariffs on imported planes implemented by President Trump, according to Chief Financial Officer Ursula Hurley. She mentioned that the majority of their forthcoming airplane deliveries are put together domestically.

Delta Air Lines Inc., American Airlines Group Inc., Southwest Airlines Co., and the parent company of Frontier Airlines all chose not to withdraw or reaffirm their commitments for the year 2025.
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As concerns over recession and inflation encouraged consumers to remain indoors.

JetBlue reported an adjusted first-quarter loss of $0.59 per share. This was better than analysts’ expectations of a $0.63 shortfall.

(Revise share information, include additional details from the call beginning in the sixth paragraph.)