JetBlue profit falls as fuel costs rise
CHICAGO (Reuters) - JetBlue Airways <JBLU.O> reported a 19 percent drop in second-quarter profit despite rising revenue as fuel prices battered the low-cost carrier and its rivals in the United States.
The airline said on Tuesday its fuel costs jumped 57.6 percent from a year ago. This trend has dominated U.S. airline earnings.
JetBlue shares dipped 3.41 percent to $5.10 on Nasdaq and hit their lowest prices since March 2010.
"The sharp increase in the price of fuel has clearly had a negative impact on the entire industry," JetBlue Chief Executive Dave Barger said on a conference call with analysts and reporters.
Other top airlines like United Continental Holdings <UAL.N> and US Airways Group <LCC.N> in the last week have reported narrowed profits in the second quarter due to rising fuel burdens.
The airline industry is struggling to recover from a years-long downturn that has been exacerbated in recent years by economic woes that drained travel demand. Some experts fear that weaker demand could hamper airline bookings in the fall.
JetBlue said its second-quarter earnings fell to $25 million, or 8 cents per share, from $31 million, or 10 cents per share, a year earlier. The latest results just missed Wall Street forecasts of 9 cents per share, according to Thomson Reuters I/B/E/S.
Revenue rose 22.4 percent to $1.2 billion, although JetBlue's fuel bill increased 57.6 percent to $439 million.
JetBlue said that for the third quarter, it expects its unit costs including fuel to increase between 13 percent and 15 percent from a year earlier. Excluding fuel, its unit costs are expected to decrease between 2 percent and 4 percent.
JetBlue ended the second quarter with $1.2 billion in unrestricted cash and short term investments.
(Reporting by Kyle Peterson; Editing by Lisa Von Ahn, Dave Zimmerman)