American Airlines Earnings Show Record Revenue, Larger Loss

American Airlines Group (AAL) reported record third-quarter revenue on Oct. 22, 2026, but widened its full-year loss forecast as soaring fuel costs squeezed margins and led the carrier to slow planned network growth in 2027.

Record Revenue and Rising Fuel Costs

Third-quarter revenue reached $16.3 billion, up 19.3% year over year and exceeding the high end of the company’s prior guidance. Passenger revenue rose to about $14.9 billion, with premium, Main Cabin, and cargo revenue increasing 22.9%, 19.5%, and 29.1%, respectively. The broad-based gains across higher-fare premium seats and cargo reflected strong demand in both business and leisure travel segments.

Fuel expense surged by $1.9 billion, or 67.5%, to approximately $4.6 billion, with the airline paying an average of $3.85 per gallon. This sharp increase was the largest cost driver in the quarter and the main reason for the company’s revised outlook. The fuel cost jump offset margin gains from higher revenue.

Despite the revenue growth, American posted a GAAP net loss of $269 million, or $0.41 per diluted share, and an adjusted loss of $182 million, or $0.28 per share. Operating income declined to $115 million from $151 million a year earlier. Unit costs excluding fuel and certain items (CASM-ex) rose 3.0%, indicating that nonfuel costs also increased and narrowed the margin cushion.

Revised Guidance and Network Growth Plans

American abandoned its prior 2026 outlook and now expects an adjusted full-year loss of $1.00 to $1.60 per diluted share, reflecting the impact of elevated fuel prices. This marks a significant shift from the earlier range that included the possibility of profit.

For the fourth quarter, the company expects revenue growth of 19.5% to 22.5% year over year and plans capacity, measured in available seat miles, to increase 5.5% to 6.5%. It assumes an average fuel price of about $4.70 per gallon based on the forward curve as of Oct. 19, 2026. At that price, fuel expense is projected to rise by roughly $2.8 billion compared with the fourth quarter of 2025. The airline forecasts an adjusted loss of $0.50 to $1.10 per diluted share for the quarter. This combination suggests that demand remains strong despite the pressure from higher input costs.

Given the elevated fuel prices, American said it will slow network growth in 2027 compared with 2026 levels. This adjustment ties capacity decisions directly to fuel cost expectations and signals a more cautious expansion approach until cost visibility improves.