Major US carrier United Airlines has posted another huge loss, with the third quarter’s $2.4 billion in losses, as the COVID-19 continues to impede demand for air travel.
United Airlines has released its third quarterly report, and it saw a huge loss as the health crisis continues to hamper demand for air travel. Particularly, the major carrier announced $2.4 billion in losses, excluding special items.
Losses for the Pandemic
United Airlines’ recent quarter loss report is less than the $2.6 billion from the preceding quarter. But the carrier’s losses slightly surpassed the forecasts of analysts, CNN Business reports. Particularly, United Airlines’ total revenue dropped by 78 percent on a year-over-year basis. Also, passenger revenue fell by 84 percent on a year-over-year basis.
United Airlines has posted its third huge quarterly loss of the year. The carrier posted a $2.4 billion loss excluding special items, slightly less the $2.6 billion it lost on that basis in the second quarter but a bit above analysts' forecasts. https://t.co/tYB6SSinDG
— CNN Business (@CNNBusiness) October 14, 2020
Also, United claimed that it managed to lower its daily average cash burn to $25 million in the third quarter. In the preceding quarter, the company said it bleeds $40 million every day.
Basically, the major carrier had to lower that amount as 9,000 of their workers voluntarily left. Moreover, the airline also convinced unions to reduce labor costs and involuntary furloughs. Also, it managed to lower non-labor operating expenses by 63 percent for the quarter.
Furthermore, United also said it reduced operating costs by 59 percent on a year-over-year basis.
United’s chief Scott Kirby said that “The negative impact of COVID-19 will persist in the near term.” However, he added that the company focuses “on positioning the airline for a strong recovery.”
In addition, Kirby also said that United has successfully implemented their initial crisis strategy. Moreover, Kirby hopes that the recovery “will allow United to bring our furloughed employees back to work and emerge as the global leader in aviation.”
CNN Business reports that the carrier has managed to raise cash amounting to $22 billion from various means like sale of stock and federal grants. Moreover, the publication said that United managed to end the third quarter with $13 billion, and it can borrow $6 billion more.