United Airlines said Monday it will lose money in the first three months of this year as it deals with the grounding of its Boeing 737 Max 9 planes after a panel blew out of a Max jetliner this month.
United said it expects to lose between 35 cents and 85 cents per share in the first quarter.
The airline said, however, that it will recover to earn a full-year profit between $9 and $11 per share. Analysts were expecting $9.48 per share, according to FactSet.
The Chicago-based airline based its forecasts on an assumption that the Max 9s will be grounded through the month of January, but not longer. Federal regulators have refused to put a timeline on letting the planes fly again, saying it will happen only when they believe the planes are safe.
United reported that despite higher revenue fourth-quarter profit fell 29%, to $600 million. The results were dragged down by a 28% increase in labor costs, partly reflecting a new union contract with pilots.
United and Alaska Airlines have canceled hundreds of flights since the Federal Aviation Administration grounded their Max 9 jets after a panel called a door plug blew off the side of an Alaska plane 16,000 feet (4,900 meters) above Oregon on Jan. 5. Investigators with the National Transportation Safety Board said they were examining whether bolts on the panel were missing or broke off.
United has 79 Max 9s in its fleet, which numbers around 1,000 planes, not counting those used by regional affiliates.
Concern about door plugs on Boeing planes widened Monday, when the FAA recommended that airlines inspect the same panel on Boeing 737-900ERs, a predecessor to the Max 9. The FAA said some airlines have inspected their 900ERs during maintenance “and have noted findings with bolts.”
United has about 130 of the older planes. The airline said Monday inspections on the 900ERs should not interfere with its operations.
The airline’s fourth-quarter profit compared with $843 million a year earlier. The company said it earned $2 a share after adjusting for one-time items, which beat the $1.69 per share mean forecast of 16 analysts surveyed by FactSet.
Revenue rose 10% to $13.63 billion, slightly better than analysts expected. Sales of premium seats and services did even better, jumping 16%.
For all of 2023, United earned $2.62 billion, more than tripling its 2022 profit of $737 million.
Airline officials were scheduled to discuss the results with analysts and reporters on Tuesday.
Shares of United Airlines Holdings Inc. fell 1% in regular trading, but rose 6% after more than two hours of extended trading following release of the financial results and forecasts.