UAL Stock Rises After Hours On Plan To Claw Back Majority Of Rising Fuel Costs

• The company now expects second quarter earnings of $1-$2 and full year earnings of $7-$11 per share.
• In the first quarter, the company said that it incurred a $340 million increase in fuel expense compared to the corresponding quarter of 2025.
• The airline now expects to fly about 5% less than it originally planned for 2026.

United Airlines (UAL) on Tuesday highlighted volatile oil prices and their potential drag on 2026 earnings amid ongoing U.S.-Iran supply concerns while also voicing optimism for recovering a majority of the costs.

Shares of the company edged up 1% after hours at the time of writing. 

Rising Fuel Cost Pressure

“Fuel remains highly volatile. If prices remain on a downward trend the company expects to be in the upper half of the adjusted diluted earnings per share guidance ranges for each of the second quarter and full year 2026, and if fuel re-escalates the company expects to be in the lower half of the adjusted diluted earnings per share guidance ranges for each of the second quarter and full year 2026,” UAL said.  

The company now expects second quarter earnings of $1-$2 and full year earnings of $7-$11 per share, down from its previous forecast of $12-$14. The company’s current guidance assumes that the company will be able to recover a majority of rising fuel costs by the end of the year, starting with 40-50% in the second quarter.

In the first quarter, the company said that it incurred a $340 million increase in fuel expense compared to the corresponding quarter of 2025 which it expects to recapture over the long term. To deal with the higher fuel costs, United Airlines has already started cutting back its flight schedule for the rest of 2026, it said.

The airline now expects to fly about 5% less than it originally planned. As a result, United’s total capacity in the third and fourth quarters of 2026 will be basically flat — or up just around 2% — compared to the same period last year.  

The company also added that it may cut even more flights or add them back later, depending on what customers actually want to book.

Opportunities Ahead

"Moments of uncertainty for the airline industry may also create opportunity for United," CEO Scott Kirby said, voicing optimism for the company’s future and reiterating commitment to grow the airline.

Last week, UAL’s rival American Airlines Group Inc. (AAL) said it is not interested in any talks of a merger with United following a media report that Kirby has floated the idea of a possible combination with the rival company.     

“While changes in the broader airline marketplace may be necessary, a combination with United would be negative for competition and for consumers, and therefore inconsistent with our understanding of the Administration’s philosophy toward the industry and principles of antitrust law,” AAL said in a statement.

Q1 Numbers

For the first quarter, the company reported adjusted and diluted earnings per share of $1.19, within the company’s guidance, and above an analyst estimate of $1.09.     

Total operating revenue increased 10.6% to $14.6 billion, including $13.17 billion in passenger revenue, above an estimated $14.4 billion.

How Did Retail Traders React?

On Stocktwits, retail sentiment around UAL fell from ‘bullish’ to ‘neutral’ territory over the past 24 hours, while message volume jumped from ‘normal’ to ‘high’ levels.

UAL stock has gained about 49% over the past 12 months. 

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