United Airlines says the hybrid lifestyle, the pandemic-induced increase in the number of people working at the office on some days and at home on others, will be good for business.
It has allowed customers “the freedom and flexibility to travel for leisure more often,” the company wrote in its third-quarter earnings announcement on Tuesday.
“With hybrid work, every weekend could be a holiday weekend,” United Airlines CEO Scott Kirby added during an earnings call Wednesday. “People want to travel and have experiences, and hybrid work environment untethered them from the office and gave them the newfound flexibility to travel far more often than before.”
All this comes despite airlines raising ticket prices while only slowly adding flights they had cut during the pandemic. Round-trip airfare had surged 41% as of June 2022 compared to the same time one year ago, according to the most recent data from the Bureau of Transportation Statistics.
In terms of the upcoming holiday season, the appetite for travel is expected to remain strong after two years of pandemic-related softness. For Thanksgiving, the average domestic flight will cost around $350 per ticket, up 43% from 2021 levels, according to Hopper, a travel agency. During Christmas, that fare is likely to be higher than the Thanksgiving average by over $100.
United said Tuesday that air travel is still recovering from the pandemic. And it expects sales to increase gradually over time.
For one thing, the strong U.S. dollar is prompting more Americans to travel overseas for both business and leisure.
“Despite growing concerns about an economic slowdown, the ongoing COVID recovery trends at United continue to prevail and we remain optimistic that we’ll continue to deliver strong financial results in the fourth quarter, 2023 and beyond,” Kirby said in a press release.
In its third-quarter earnings, United beat Wall Street expectations with revenue of $12.88 billion versus a forecasted $12.72 billion. Its earnings per share was $2.81, versus an average analyst estimate of $2.29.
United’s shares surged 7.1% during early trading on Wednesday before retreating somewhat to close with a 5% gain.
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