American Airlines reported strong corporate demand in the
second quarter, though corporate revenue declined year over year.
Corporate revenue declined 1 percent year over year, but
total operating revenue declined 4.3 percent to $10.4 billion, "so it's
obviously outperforming the rest of the system," American Airlines
president Scott Kirby said in a conference call to investors. "We have a
lot of low fares in the markets, so they're getting a deal right now."
Executives said Brexit should not impact the carrier substantially
in the short term. Currency effects have caused a hit, as about 4 percent of
American's revenue is sold in the British pound, but booked revenue has
rebounded to pre-Brexit levels in the month following the vote, Kirby said.
"Longer term, the issue is going to be what happens
with the U.K. economy and with the banking industry in particular," he
said. "Near-term, I don't anticipate a lot of issues."
The carrier also has deferred delivery of 22 Airbus A350 XWB
aircraft from spring 2017 to 2018.
American increased capacity 1.2 percent year over year
during the quarter, and traffic increased 0.6 percent. The carrier's load
factor declined 0.5 percentage points to 82.9 percent, and yield declined 6.4
percent. The deferral will reduce capital expenditures next year and
"provides capacity flexibility," according to American.
The company reported net income of $950 million
during the quarter, down from $1.7 billion in the second quarter of 2015.