JetBlue posts smaller-than-expected loss as U.S. demand recovers

By Aishwarya Jain and Doyinsola Oladipo

July 29 (Reuters) - JetBlue Airways JBLU.O on Tuesday posted an adjusted loss for the second quarter that was smaller than Wall Street expectations, helped by cost cutting measures and recovering demand for travel in the U.S.

Shares of the carrier shot up nearly 12% in early morning trading as the company also said it received the green light from the US Department of Transportation to proceed with a partnership with United Airlines UAL.O.

"Over the quarter, we saw encouraging signs of an improved demand environment as the number of close-in bookings accelerated as the quarter progressed," said Marty St. George, JetBlue's president on a post-earnings call.

Unlike larger peers Delta DAL.N and United, who reinstated their 2025 earnings guide on signs that bookings are starting to stabilize, JetBlue did not, noting limited visibility into the fourth quarter and industry capacity.

In April, JetBlue joined several major airlines in pulling its 2025 financial forecast, citing uncertainty tied to the Trump administration's sweeping tariff policies and federal spending cuts that weighed on consumer travel.

The carrier said it expects third-quarter revenue per available seat mile (RASM), an industry metric commonly known as unit revenue and a proxy for pricing power, to decline between 2% and 6%.

It also reinstated its 2025 unit cost forecast and expects it to rise between 5% and 7%. The New York-based airline said unit revenue during the second quarter declined 1.5%, which exceeded previous guidance, as premium and transatlantic travel demand also boosted results.

The carrier reported an adjusted loss of 16 cents per share for the quarter ended June 30, compared to analysts' estimate of a loss of 33 cents apiece.

Operating revenue was $2.18 billion. Analysts, on average, were expecting $2.28 billion, as per data compiled by LSEG.

The carrier said it expects to return to capacity growth in 2026 in part due to an improved impact from ongoing inspections of RTX's RTX.N Pratt & Whitney Geared Turbofan engines. The company now expects fewer than 10 grounded aircraft in 2025 down from mid-to-high teens.