If you follow the US airline industry, you know that among the “big three” carriers, Delta is the most profitable, followed by United, followed by American. American has today released its 2025 full-year results, and the difference in profitability continues to grow, as the company’s leadership is seemingly running out of empty promises it can make.
American reports $111 million profit for 2025, an 87% decline
American has today reported its 2025 full-year results, and they’re pretty brutal, at least competitively:
- The company had net income of $111 million, down 87% compared to $846 million the previous year
- The company had total operating revenue of $54.6 billion, up 0.8% compared to $54.2 billion the previous year
- The company had total operating expenses of $53.2 billion, up 3% compared to $51.6 billion the previous year
- The company had passenger load factor of 83.6%, down 1.3% compared to 84.9% the previous year
- The company had total revenue per available seat mile of 18.25 cents, down 1.4% compared to 18.51 cents the previous year
Admittedly 2025 was a tougher year for airlines than 2024, given all the economic uncertainty in the first half of the year. The issue is that American was already so greatly lagging Delta and United, so when things take a turn for the worse, you don’t want to be in American’s position. As a point of comparison, Delta’s net income for 2025 was $5 billion, while United’s was $3.4 billion.
The only positive news here (which is sending American’s stock up) is that the airline has positive projections for 2026. For the full year, the airline is expecting adjusted earnings per diluted share of $1.70-2.70.
In the first quarter of 2026 (compared to the same quarter of 2025), the airline is expecting available seat miles to be up 3-5%, total revenue to be up 7-10%, cost per available seat mile to be up 3-5%, and an adjusted loss of $0.10-0.50 per share.
I can’t help but think that American is very much making “best case scenario” projections here. While it’s important for CEOs of publicly traded companies to be somewhat reliable in terms of the narrative they tell, airline executives have a bit of flexibility nowadays, given how many outside events can impact airline performance.
American doesn’t really have a narrative for fixing things
It’s kind of amazing how American still sort of lacks a narrative for fixing things. Regarding the 2025 results, here’s what American CEO Robert Isom had to say:
“American Airlines is positioned for significant upside in 2026 and beyond. We have built a strong foundation, and we look forward to taking advantage of the investments we have made in our customer experience, network, fleet, partnerships and loyalty program. The strategy we have in place will put American in the right position as we celebrate our centennial and embark on our next 100 years as a premium global airline.”
The airline has been around for 100 years, and it’s still working on “building a strong foundation,” and it “looks forward to taking advantage of the investments that have been made.” This is basically the same type of story we’ve heard year after year. It’s never what has been meaningfully accomplished, but instead, how it positions the carrier better for the future.
When American reported its 2024 earnings results (a year ago), here’s what Isom had to say:
“The American Airlines team achieved a number of important objectives in 2024. We continue to run a reliable operation, and we are reengineering the business to build an even more efficient airline. That, coupled with our commercial actions, resulted in strong financial performance in the fourth quarter. As we look ahead to this year, American remains well-positioned because of the strength of our network, loyalty and co-branded credit card programs, fleet and operational reliability, and the tremendous work of our team.”
What about the year before that? Well, here’s what Isom had to say about 2023 earnings results:
“The American Airlines team produced an exceptionally strong performance in 2023. We are delivering on our commitments and remain well-positioned for the future, supported by the strength of our network and travel rewards program, our young and simplified fleet, our operational reliability, and our outstanding team. As we look forward, we remain focused on delivering a reliable operation for our customers and reengineering the business to build an even more efficient airline.”
American is essentially arguing that it has a lot of upside because of the extent to which it’s investing in a premium customer experience, though it’s not in any way clear how this will set American apart from Delta or United, or allow the airline to win market share.
The airline also argues that it’s maximizing the power of its network and fleet, and how it “operates the strongest network in the U.S.,” “with eight hubs in the 10 largest metropolitan areas.” Essentially, the airline claims that everything that has been done will suddenly improve things, but it hasn’t worked in the past, so it’s not clear how it’s supposed to work in the future.
For that matter, one certainly wonders how American’s profitability will be impacted by the battle it’s having with United in Chicago, where United CEO Scott Kirby is predicting that American will lose $1 billion over the course of the year. We’ll see how that plays out, but that doesn’t exactly suggest that increased profitability is on the horizon.
Of course when looking at the paltry $111 million profit, one can’t help but be reminded of how in 2017, former American CEO Doug Parker said that the airline would never lose money again, and even in a bad year, the airline should earn around $3 billion in profits. That sure didn’t age well, did it?
I continue to think that while Isom is a nice guy, he’s not the person who can turn the airline around. American needs a hard reset, with all employees rallying behind a new vision. Isom has simply lost (or maybe never had?) the support of frontline workers, and he’s not doing much to inspire them, it seems (and the 0.3% profit sharing they’re getting certainly won’t help).
Bottom line
American has reported its 2025 financial results, and the airline had a net profit of $111 million, down 87% compared to the previous year. For that matter, American’s profits were 2% as big as Delta’s, as the airline reported earnings of $5 billion.
Unfortunately American lagging both Delta and United with financial performance is nothing new. While the airline expects that 2026 will be a better year, we saw similar projections in 2025, and that didn’t work out so well.
Unfortunately American just doesn’t have much of a narrative here as to how things will improve, other than emphasizing how it’s premium, its network, and its reliability, even though those are all three areas where American arguably lags Delta and United.
What do you make of American’s 2025 financial results?
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