It has been about a month since the last earnings report for United Airlines (UAL). Shares have added about 8.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is United due for a pullback? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent catalysts for United Airlines Holdings Inc before we dive into how investors and analysts have reacted as of late.
Earnings Beat in Q2
UAL's reported mixed second-quarter 2025 results wherein the company’s earnings beat the Zacks Consensus Estimate, but revenues missed the same.
UAL's second-quarter 2025 adjusted earnings per share (EPS) (excluding 90 cents from non-recurring items) of $3.87 surpassed the Zacks Consensus Estimate by a penny but declined 6.5% on a year-over-year basis. The reported figure lies within the guided range of $3.25-$4.25.
Operating revenues of $15.2 billion fell short of the Zacks Consensus Estimate of $15.4 billion but increased 1.7% year over year. Passenger revenues (which accounted for 90.8% of the top line) increased 1.1% year over year to $13.8 billion. UAL flights transported 46,186 passengers in the second quarter, up 4.1% year over year.
Cargo revenues grew 3.8% year over year to $430 million. Revenues from other sources rose 8.8% year over year to $970 million.
UAL’s diverse revenue sources contributed to its second-quarter results. These include premium cabin revenues, which went up 5.6% year over year, revenue from Basic Economy (up 1.7% year over year), cargo revenues (up 3.8%) and loyalty revenues (up 8.7%).
Other Details of UAL’s Q2 Earnings Report
Below, we present all comparisons (in % terms) with the second quarter of 2024 figures unless otherwise stated.
Airline traffic, measured in revenue passenger miles, grew 4.5%. Capacity, measured in available seat miles, expanded 5.9%. Although traffic improved year over year, it failed to outpace capacity expansion. As a result, the consolidated load factor (percentage of seats filled by passengers) declined 1.1 points on a year-over-year basis to 83.1%. We had expected the consolidated load factor to be 79.5%.
Consolidated passenger revenue per available seat mile (a key measure of unit revenues) inched down 4.5% year over year. Total revenue per available seat mile decreased 4% year over year. The average yield per revenue passenger mile fell 3.2% year over year to 19.74 cents. The average aircraft fuel price per gallon fell 15.3% year over year to $2.34. Fuel gallons consumed were up 4.7% year over year.
Operating expenses (on a reported basis) increased 6.5% year over year to $13.9 billion. Consolidated unit cost or cost per available seat mile, excluding fuel, third-party business expenses, profit-sharing and special charges, inched up 2.2% year over year to 12.36 cents.
UAL exited the second quarter with cash and cash equivalents of $9.35 billion compared with $9.37 billion at the prior-quarter end. Long-term debt, finance leases and other financial liabilities were $20.8 billion compared with $24.4 billion at the first-quarter end.
UAL repurchased $0.2 billion of shares in the second quarter of 2025. UAL generated $1.13 billion of free cash flow in the June quarter.
UAL’s Outlook
UAL anticipates less geopolitical and macroeconomic uncertainty in the second half of 2025, with demand inflection beginning in early July with a 6-point acceleration in booking demand.
For third-quarter 2025, UAL anticipates adjusted EPS between $2.25 and $2.75.
For 2025, UAL now expects adjusted EPS between $9.00 and $11.00.
The updated 2025 EPS guidance comes in contrast with UAL’s prior 2025 dual EPS guidance unveiled during first-quarter 2025 (for a stabilized environment, 2025 adjusted EPS is expected to be between $11.50 and $13.50; for a recessionary environment, 2025 adjusted EPS is expected to be between $7 and $9).
UAL expects adjusted capital expenditures to be less than $6.5 billion.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
VGM Scores
At this time, United has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock has a grade of A on the value side, putting it in the top 20% for value investors.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, United has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
United belongs to the Zacks Transportation - Airline industry. Another stock from the same industry, Delta Air Lines (DAL), has gained 4.7% over the past month. More than a month has passed since the company reported results for the quarter ended June 2025.
Delta reported revenues of $16.65 billion in the last reported quarter, representing a year-over-year change of -0.1%. EPS of $2.10 for the same period compares with $2.36 a year ago.
Delta is expected to post earnings of $1.48 per share for the current quarter, representing a year-over-year change of -1.3%. Over the last 30 days, the Zacks Consensus Estimate has changed +0.8%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Delta. Also, the stock has a VGM Score of B.
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United Airlines Holdings Inc (UAL): Free Stock Analysis Report Delta Air Lines, Inc. (DAL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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