American Airlines CEO Calls United Deal A 'Non Starter' — Signals Airfare Hikes Could Be Coming

• American Airlines CEO said the company would not pursue any talks regarding the merger with United Airlines.
• The company anticipates modest profitability for the year, assuming the current forward fuel curve.
• The company expects its jet fuel bill to rise by more than $4 billion this year.

American Airlines Group Inc. (AAL) CEO Robert Isom on Thursday reportedly said that a merger with United Airlines Holdings Inc. (UAL) was a “non-starter.” 

During an interview with CNBC, Isom stated that a merger with UAL was not a good idea and that it could be anti-competitive. He also added that the company would not pursue any merger talks. These comments come at a time when U.S. regulators have taken a tougher stance on airline consolidation. 

Fuel Costs Could Push Fares Higher 

Instead, the bigger focus would be on costs, especially fuel. Isom cautioned that a hike in airfares could be possible in the second half of 2026 if energy prices remain elevated.

For the second quarter guidance, the company said it assumes continued revenue improvement in the domestic entity, growth in corporate customer volumes and the ability to partially recapture elevated fuel prices, currently assumed to be approximately $4.00 per gallon.

The company expects its jet fuel bill to rise by more than $4 billion this year.

AAL’s 2026 Outlook

Despite the cost headwinds, American Airlines is guiding for modest profitability this year. The company stated that, depending on fuel price trends and its current revenue outlook, the midpoint of full-year guidance is projected to be roughly flat compared to 2025.

“Even in a volatile operating environment, our pretax margin improved by nearly 2 points year over year, and we still anticipate modest profitability for the year assuming the current forward fuel curve,” said American’s CEO Robert Isom.

Q2 Guidance Highlights Uncertainty

For the second quarter, American Airlines expects the earnings to be in the range of a loss of 20 cents per share to earnings of 20 cents per share.

AAL: No Interest In Spirit Airlines

When asked about the possibility of a Spirit Airlines bailout, CEO Isom said the company is ‘not interested’ and that the business models of the two companies are not compatible.

He further said that the government’s support to the airline industry during the 9/11 and pandemic was highly important, but provided no comment on the reports of the Trump administration’s possible aid to Spirit Airlines, stating “I am going to leave that to the administration”. 

American Airlines’ First Quarter Earnings

The company reported an adjusted loss of $0.40 per share in the first quarter (Q1), beating analysts' estimate of a loss of 47 cents per share.

American Airlines posted a revenue of $13.9 billion, exceeding analysts' expectations of $13.7 billion for the first quarter.

AAL Stock: How did Retail Traders React?

On Stocktwits, retail sentiment surrounding the stock has improved from ‘bullish’ to ‘extremely bullish’ while message volumes also remained in the ’high’ territory.

Shares of American Airlines rose over 1% premarket on Thursday.

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