Earnings Preview: JetBlue

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NEW YORK -JetBlue Airways Corp. reports earnings for the third quarter on Thursday. The following is a summary of key developments and analyst opinion related to the period.

OVERVIEW: JetBlue and other low-cost carriers have shown resilience in the last few quarters, posting profits when larger carriers lost money. Overall cheaper fares and heavy ticket discounting have managed to draw passengers to the skies despite a sluggish economy. JetBlue is also adding routes in spots other airlines are leaving, such as the Caribbean. The carrier has also announced plans to add service to San Francisco and expanded flights from Boston.

JetBlue is expected to post a small profit again this quarter, although revenue may slip because of those cheaper seats.

BY THE NUMBERS: Analysts polled by Thomson Reuters expect JetBlue to post a profit of 5 cents per share on $846.8 million in sales. Last year, the Forest Hills, N.Y.-based carrier lost $4 million, or 2 cents per share, with revenue of $902 million.

JetBlue rival Southwest lost $16 million in the third quarter, or 2 cents per share. Not including special items it would have shown a $23 million profit, or 3 cents per share.

WHATS AHEAD: JetBlue has said it will remain profitable for at least the rest of this year, after making money in the first two quarters. The airline's revenue benefited in prior quarters from added fees for things like extra legroom, headsets, pillows and blankets. This so-called ancillary revenue has offset some of the money lost from cheaper tickets, and JetBlue has said it will likely expand its fees. It raised fees for extra legroom last quarter, saying its customers had gotten used to them and were starting to choose those higher-priced seats in larger numbers.

STOCK PERFORMANCE: Shares of JetBlue are down 13 percent so far this year. But the stock jumped 40 percent in the third-quarter as many analysts said the recession had bottomed.

2009-10-21 13:36:00