JetBlue pulls outlook, sees travel demand slowdown worsening

JetBlue Airways Corp. withdrew its full-year financial outlook and said a slowdown in demand for air travel is poised to worsen as President Donald Trump’s trade war erodes consumer confidence.

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.

Slowing air travel threatens to derail a plan crafted by Chief Executive Officer Joanna Geraghty to return the airline to profitability. JetBlue focuses largely on domestic trips, particularly in the northeastern US and along the East Coast, areas hit hard by the slowdown.

Also Read: Emirates fined $1.5m by US Transportation Department for flights in prohibited airspace

“Given the macroeconomic uncertainty, we are not reaffirming our prior full-year guidance,” Geraghty said in a statement as JetBlue detailed first-quarter earnings.

The carrier separately said it expects to announce a new partnership agreement this quarter after the breakup of talks with American Airlines Group Inc. to revive a version of their alliance in the northeastern US.

That agreement was blocked by a federal judge, who ruled it violated antitrust laws. American has sued JetBlue to recover money, which it says is owed from an unwinding of the partnership, which focused on flights in Boston and the New York area.

Joining forces with another airline could help JetBlue contend with an increasingly challenging environment. JetBlue’s shares rose 4.3% as of 1:41 p.m. in New York. The stock had tumbled 48% this year through Monday’s close, far worse than the S&P 500 Index’s 6% decline.

Also Read: Haiti’s main international airport reopens one month after gang violence forced it to close

JetBlue had already been trimming flying capacity on days with weaker demand in March and April, reducing operations in 20 cities. Revenue for each seat flown a mile rose by high-single digits during periods of peak demand in those months compared with last year, but fell by double-digits during less popular times, St. George said during a conference call with analysts and investors.

“JetBlue, like peers, is grappling with negative consumer sentiment amidst heightened macro uncertainty,” TD Cowen analyst Tom Fitzgerald said in a note.

JetBlue also cancelled planned daily flights between Boston and Halifax, Nova Scotia. The new route — JetBlue’s first to be dropped before service began — had been set to start in June. The company scrapped the flight after travel from Canada to the US collapsed earlier this year. “It was just not going to be accretive for us anytime soon, so we figured we’d better rip off the Band-Aid now and move forward,” St. George said.

Also Read: It’s beginning to look like another record for holiday travel in the US

The company is considering additional capacity cuts and possibly reducing the number of older aircraft in its fleet. A voluntary early retirement program for pilots will conclude this quarter.

Non-fuel costs to fly each seat a mile, a gauge of efficiency, could climb as much as 8.5% year-over-year in the current quarter, suggesting the airline continues to struggle to control expenses.

One near term positive: JetBlue doesn’t expect a “meaningful impact” this year from tariffs imposed by Trump affecting imported aircraft, Chief Financial Officer Ursula Hurley said. Most of its upcoming jetliner deliveries are assembled in the US, she said.

Delta Air Lines Inc., American Airlines Group Inc., Southwest Airlines Co. and the parent of Frontier Airlines each either withdrew or declined to reaffirm their 2025 guidance as recession and inflation fears persuaded consumers to stay home.

JetBlue posted an adjusted first-quarter loss of 59 cents a share. Analysts were expecting a 63-cent deficit.