American Airlines posts $2.2 billion loss during pandemic

DALLAS (AP) — American Airlines reported a staggering loss of $2.24 billion for the first quarter, when the coronavirus pandemic triggered a sharp drop in air travel.

The airline said Thursday that revenue fell 19% while costs continued to rise even as the virus spread.

The situation facing the airline industry has grown more dire since the first quarter ended. Air travel within the U.S. has plunged 95% from a year ago, judging by the number of people screened at the nation's airports.

“Never before has our airline, or our industry, faced such a significant challenge,” Chairman and CEO Doug Parker said.

American's massive loss compared with a profit of $185 million in the same quarter last year. It was American's largest quarterly loss since merging with US Airways in 2013.

American said that adjusted for non-recurring items, it lost $2.65 per share. That was worse than the average forecast of a $2.08 per share loss from 15 analysts surveyed by FactSet.

Shares of American Airlines Group Inc. dropped nearly 11% before a partial rebound; they were down about 4% by midmorning.

Parker highlighted American's efforts to bolster its liquidity — building up enough cash, it hopes, to ride out the pandemic — including getting $5.8 billion in federal aid to help cover payroll costs through September.

American estimated that it ended March with $6.8 billion in cash and other liquidity, including $2 billion that it raised during the first quarter, and will have $11 billion at the end of June.

The airline has applied for another $4.75 billion in loans from the Treasury Department at around 4% interest. The loans must be secured, and airline executives did not rule out using American's AAdvantage loyalty program as collateral, although negotiations are continuing.

The...