Strong travel demand and higher fares helped United Continental Holdings grow its third-quarter profit nearly 30 percent, and encouraged the carrier to lift its profit outlook for the year despite a surge in fuel costs.
Shares of United Airlines’ parent company rose more than 5 percent in aftermarket trading after it posted results Tuesday for the quarter that closed Sept. 30.
United’s net income during the third quarter, which included the peak summer travel season, rose 29.6 percent from a year ago to $863 million on revenues of about $11 billion, which climbed more than 11 percent from the same period last year.
United CEO Oscar Munoz said in a statement that he is “more confident than ever” that the airline can reach its target of adjusted per-share earnings of between $11 and $13 by 2020.
The airline’s fuel cost increased more than 35 percent in the quarter, United said.
Revenue per available seat mile, a key measure of how much airlines make per seat, rose 6.1 percent in the July-September quarter from a year earlier.
United posted adjusted per-share earnings of $3.06, just shy of an expected $3.07 a share, according to average estimates by analysts polled by Refinitiv, formerly Thomson Reuters.
United slightly raised its forecast for full-year profits from a range of $7.25 to $8.25 per share to $8 to $8.25 per share.
The airline’s executives will hold a call to discuss the results with analysts on Wednesday at 10:30 a.m.
United is a standout among its U.S. rivals, whose stock prices have struggled this year. The company’s stock is up roughly 24 percent so far this year, the most of any U.S. airline. United exceeded profit expectations in the first half of the year despite an aggressive-growth strategy that initially drew skepticism from investors when it was announced earlier this year.
Shares of Delta Air Lines, which beat Wall Street expectations on its third-quarter profit it reported late last week, are down more than 5 percent so far this year. American Airlines and Southwest Airlines, which report third-quarter earnings on Oct. 25, are down 36 percent and 10 percent, respectively.