(Reuters) - American Airlines Group Inc on Tuesday trimmed its first-quarter revenue forecast after cancelling hundreds of flights during the period, mainly due to the global grounding of Boeing Co's 737 MAX.
American owns 24 MAX jets, the brand-new, fast-selling Boeing aircraft whose use was suspended around the world in March following two deadly crashes.
Shares of American fell 3 percent after the airline said it now expects https://www.sec.gov/Archives/edgar/data/4515/000000620119000014/a8kinvestorupdateex991q1-19.htm revenue per available seat mile, a closely followed measure of performance, to be flat to up 1 percent compared with the prior forecast of flat to 2 percent growth.
The No. 1 U.S. airline said it will extend cancellations of 90 flights a day until June 5, an indication that the Boeing aircraft may not return to service soon.
The carrier also cut its first-quarter outlook for margins, citing higher fuel prices. Excluding special items, the company now expects pre-tax margin to be about 2 percent to 4 percent, compared with its prior forecast of 2.5 percent to 4.5 percent.
Smaller rival Southwest Airlines Co https://www.reuters.com/article/us-southwest-outlook/southwest-trims-first-quarter-outlook-after-737-max-groundings-idUSKCN1R810K was the first U.S. airline to formally cut its financial outlook for the year after being forced to pull its new fleet of 34 Boeing 737 MAX planes out of service.
United Airlines and Air Canada had earlier warned of a hit to their businesses due to the groundings, with the Canadian carrier suspending its 2019 financial forecasts.
Boeing, which is battling its worst crisis in years, said on Friday it would cut production of its 737 MAX jets by 20 percent.
The planemaker's key supplier Spirit Aerosystems Inc however said it will maintain its deliveries to Boeing at the current rate of 52 shipsets a month.
Shares of American Airlines were down at $32.88 in early trading. They have risen about 5.5 percent so far this year.
(Reporting by Rachit Vats in Bengaluru; Editing by Arun Koyyur and David Gregorio)