The companies on the Global 500 employ 70.2 million people, and their revenue represents more than one-third of the world’s GDP.

Fortune Global 500

With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

AI is a major force shaping this year’s list—but it’s far from the only story.

World's Most Admired Companies

This is the 40th year for our annual Fastest-Growing Companies list, which ranks companies based on growth in revenue, profits, and stock returns.

100 Fastest-Growing Companies

The corporations on our annual list of the world's 500 largest companies combined to generate $41.7 trillion in revenue over the past year.

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

Leaders in all industries rely more than ever on Big Tech—and appreciate the giants that deliver, at scale, without drama.

The corporations on our annual list posted aggregate revenues of $41 trillion for the second year in a row.

Industries included in the sector are airlines, transportation equipment, logistics, mail and freight delivery, railroads, shipping, and trucking.

Fortune Sector Leaders: Transportation

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The 26th edition of the list shows how much esteem Big Tech giants command among other business leaders.

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The corporations on our annual list of the world’s largest companies delivered a record $41 trillion in aggregate revenues.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

F500-2023-096-United Airlines

United Airlines, one of the largest American airline carriers by revenue, has jumped 50 spots on this year’s Fortune 500, securing a spot within the top 100. 
<ul> 
 	<li>The Chicago-based company benefited from the post-COVID travel rebound, bringing in $45 billion in revenue in 2022, an 83% increase from 2021.</li> 
 	<li>United, like its rivals, faced a number of challenges through 2022—from high fuel costs and staffing shortages to delays in airplane deliveries. But the company’s 2022 fourth-quarter profit outstripped Wall Street estimates as consumers proved willing to shell out money to take trips.</li> 
 	<li>As travel demand continues to recover, United has purchased 100 new aircraft (with an option to buy 100 more) to support its growth. It also added new routes over the summer, including some that it dropped in previous years. The airline has yet to finalize a new contract with its pilots after five years of negotiations.</li> 
 	<li>United’s flight training school, United Aviate Academy, graduated its first class in January 2023, and boasted that 80% of the graduating class was made up of women or people of color.</li> 
</ul>

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This year’s Fortune 500 marks the 68th running of the list.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-200-United Airlines Holdings

One of the most recognized airlines in the country, United is based in Chicago and offers national and international flights. While business travel remains depressed, leisure bookings are recovering faster from the pandemic than expected.

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-276-United-Airlines-Holdings

United overcame international and aircraft-related challenges to flourish in 2019. Despite the grounding of its Boeing 737 MAX jets and the impact of Hong Kong protests on its flights there, United increased its passenger revenue and benefitted from low fuel costs; overall revenues rose 4.7% to $43.3 billion, and profits jumped 41.3%, to $3 billion. CEO Oscar Munoz, who spent years helping United recover from its troubled merger with Continental, last June dropped the latter’s name from the combined company. J. Scott Kirby, who had been president of the company succeeded Munoz as CEO in May 2020. But the airline’s large international business meant that United was one of the first U.S. carriers to feel the effects of the coronavirus pandemic; by April, it had accepted government aid, slashed capacity, given voluntary unpaid leaves of absence to more than 20,000 workers, and reported $1.7 billion in first-quarter losses. The pain continued in the second quarter as sales plummeted 87% compared to the year before and United reported a loss of $1.6 billion.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-076-United-Airlines

United overcame international and aircraft-related challenges to flourish in 2019, gaining two spots on the list. Despite the grounding of its Boeing 737 MAX jets and the impact of Hong Kong protests on its flights there, United increased its passenger revenue and benefitted from low fuel costs; overall revenues rose 4.7% to $43.3 billion, and profits jumped 41.3%, to $3 billion. CEO Oscar Munoz, who spent years helping United recover from its troubled merger with Continental, in June dropped the latter’s name from the combined company. J. Scott Kirby, who had been president of the company succeeded Munoz as CEO in May 2020. But the airline’s large international business meant that United was one of the first U.S. carriers to feel the effects of the coronavirus pandemic; by April, it had accepted government aid, slashed capacity, given voluntary unpaid leaves of absence to more than 20,000 workers, and reported $1.7 billion in first-quarter losses.

Here are the World's Most Admired Companies for 2019 as ranked in their industries. See who made the list.

This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

This year's Fortune 500 marks the 65th running of the list.

This year's Fortune 500 marks the 64th running of the list.

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This year's Fortune 500 marks the 63rd running of the list.

Here are the World's Most Admired Companies for 2016 as ranked in their industries. See who made the list.

This year's Fortune Global 500 generated $27.6 trillion in revenues and $1.5 trillion in profits.

This year's Fortune 500 marks the 62nd running of the list.

The world's 500 largest companies generated $31.2 trillion in revenues and $1.7 trillion in profits in 2014. Together, this year's Fortune Global 500 employ 65 million people worldwide and are represented by 36 countries.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Global business is back. After limping through a worldwide financial crisis and economic slowdown, the 500 largest companies ranked by revenues shattered all sorts of performance records in 2013: They racked up combined revenues of $31.1 trillion, up 2.5% from 2012, and profits soared 27% to nearly $2 trillion. China’s 95 companies (up from 89 last year) posted $5.8 trillion in revenues. The U.S. has four fewer companies on the list than last year but remains (for now) the country leader, with 128 corporations on the list—including No. 1 Wal-Mart Stores—reporting $8.6 trillion in revenues. 

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

Fastest-growing Companies

Revenue 3 Yr Growth Rank

Revenue 3 Yr Annual Growth Rate

EPS 3 Yr Growth Rank

EPS 3 Yr Annual Growth Rate

Total Return 3 Yr Rank

Total Return 3 Yr Annual Rate

Beat S&P 500 3 Yr Return

Current Streak

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Current All-Star Rank

Previous All-Star Rank

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Incorporated in 1968, United Airlines Holdings is one of the world’s largest airlines. It transports both people and cargo internationally. It also provides third-party services, including maintenance and ground-cargo handling.

Q2 2026

Q1 2026

Q4 2025

Q3 2025

Q2 2025

Q1 2025

Q4 2024

United Airlines Holdings (UAL): Company Profile, Stock Price, News, Rankings

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United Airlines Holdings

united airlines holdings

Good morning, and welcome to United Airlines Holdings Earnings Conference Call for the First Quarter of twenty twenty five. My name is Sarah, and I will be your conference facilitator today. Following the initial remarks from management, we will open the lines for questions. This call is being recorded and is copyrighted. Please note that no portion of the call may be recorded, transcribed or rebroadcast without the company's permission.

Your participation implies your consent to our recording of this call. If you do not agree with these terms, simply drop off the line. I will now turn the presentation over to your host for today's call, Christina Edwards, Managing Director of Investor Relations. Please go ahead.

Thank you, Sarah. Good morning, everyone, and welcome to United's first quarter twenty twenty five earnings conference call. Yesterday, we issued our earnings release, which is available on our website at ir.united.com. Information in yesterday's release and remarks made during this conference call may contain forward looking statements, which represent the company's current expectations, which are based upon information currently available to the company. Number of factors could cause actual results to differ materially from our current expectations.

to our earnings release, Form 10 ks and 10 Q and other reports filed with the SEC by United Airlines Holdings and United Airlines for a more thorough description of these factors. Unless otherwise noted, we will be discussing our financial metrics on a non GAAP basis on this call. Please refer to the related definitions and reconciliations in our press release. For a reconciliation of these non GAAP measures to the most directly comparable GAAP measures, please refer to the tables at the end of our earnings release. Joining us on the call today to discuss our results and outlook are our Chief Executive Officer, Scott Kirby President, Bret Hart Executive Vice President and Chief Commercial Officer, Andrew Nocella and Executive Vice President and Chief Financial Officer, Mike Leskinen.

In addition, we have other members of the executive team on the line available for the Q and A. And now, I'd like to turn

Thanks, Christina, and good morning, everyone. The first quarter of twenty twenty five was sure eventful. It's clear that the softer macroeconomic environment is driving both volatility in the market and softer demand for travel. But for United specifically, two big picture themes have been confirmed.

First, United's performance is strong even in this weak environment because we've won the battle for brand loyal customers. And second, because we've won those brand loyal customers, our earnings and financial metrics are demonstrating resilience that United's never had before. The strains on the macro economy have impacted demand, but even in that strained environment, United just had the highest first quarter pretax margin since COVID began and we expect to be one of only two airlines that are profitable in the first quarter. And our resilience is further demonstrated by the fact that if the environment remains relatively weaker, but stable, we can stay within our full year guidance range. However, we read the same headlines as you and so we think that there's a reasonable chance that bookings could weaken from here.

But even if we're in that recessionary environment, we still expect to earn $7 to $9 per share for the full year 2025. When I say that there's been a structural permanent irreversible change, what I mean is that United has won brand loyal customers and they are sticky lifelong customers. We are now the brand loyal leader by a wide margin in six of our seven hubs and tied with one other airline in Los Angeles. In most spokes around the country, we're the leader or one of the leaders of brand loyal customers. Andrew will share some facts on customers that live in the Bay Area, Denver and Chicago in his remarks.

But it is those gains that are allowing us to be resilient even in this weaker economic environment. To be clear, even though those customers are sticky and we believe those market share gains are permanent, we're capitalizing on our momentum and doing more to attract even more brand loyal customers. We're building huge new clubs in Houston and San Francisco and about to open an additional new club in Denver. We're installing the fastest Wi Fi in the world on our planes with Starlink and they'll start flying next month. We're adding new features to the most powerful travel app in the world every couple of weeks and our operation is reliable and resilient as ever.

This weakening environment doesn't have us reconsidering these investments. In fact, we're leaning into them because they're at the center of our biggest competitive advantage, winning brand loyal customers. And a huge thank you to our employees for their incredible service that makes this win possible. Periods of economic softening are part of the business cycle. So the question for United is what should we do now that we see economic softness?

Tactically, we're being very diligent about expenses and removing capacity, particularly off peak utilization flying, and Andrew and Mike will talk about those in a few minutes. And strategically, our priority is pretty simple and it hasn't changed. Win the brand loyal customers because that gives us the best margins in good times and that lead can grow even larger during lean times. The reason is that for any given customer living in any given city, you're not the brand loyal airline, you're the spill airline. The only way a spill airline gets passengers is through lower prices.

When times are good, that strategy can work okay. But when times get tougher, the brand loyal airline like United has more seats to sell, which we do sell at lower prices, but that disproportionately impacts all the Spirit carriers that we compete with. Some of the recent guidance updates from other airlines are a stark reminder of this point. For some historical perspective, Southwest historically was the airline with the highest percentage of brand loyal customers. For most of its history, Southwest was focused on smaller secondary cities where they had by far the best schedule for customers.

They also had a huge customer advantage as the only airline that didn't have change fees or back fees. That meant that a high percentage of their customers were brand loyal to Southwest. At its core, that's why Southwest historically was the highest margin airline in good times and why they always outperformed by an even wider margin when times got tough. But as they've moved into big high cost hubs of other airlines, both of those advantages are gone. And now United and one other airline are the brand loyal customer leaders.

It's always dangerous to say that it's different this time. And in fact, we're saying exactly the opposite. It's going to be exactly the same this time. History is just repeating. The only thing that changed is that United is now one of the two brands leading brand loyal airlines.

So to conclude, United NEXT is the right strategy. It's well executed by our people and it's producing strong resilient results in good times and even more impressively in tough times. United has never been in a stronger competitive position. Customers are benefiting, our employees are benefiting and our shareholders will also benefit in the value that's being created. Brett, over to you.

Thank you, Scott, and good morning. Despite a challenging macro environment, 2025 is off to a solid start. We operate in a dynamic and evolving landscape. Global trade policies, including tariffs are shaping that landscape. And as Scott mentioned, broader economic uncertainties remain top of mind.

We are closely monitoring the potential impact on the prices we would pay for aircraft. As a reminder, Boeing accounts for the majority of our future total order book and most of our Airbus 321neos are produced in Alabama. As such, we don't currently anticipate a meaningful direct impact from tariffs relating to aircraft purchases. Turning to our performance this quarter, We are seeing the results of our continued investments in operational excellence and we are delivering an exceptional customer experience. These achievements are a testament to the commitment and excellence of our employees.

None of it would be possible without you. Thank you. In Q1, not only did we serve more customers than ever in our first quarter for United, but we also finished number one in on time departures among our U. S. Large peers when including customers who were helped with ConnectionSaver.

We achieved our highest NPS scores and our best on time arrival score since the pandemic, as well as the second lowest first quarter seat cancellation rate in company history. We accomplished all of this with safety at the forefront. United is committed to getting every customer to their destination safely and on time. We continue to invest in enhanced pilot training and safety technology making it easier for our employees to report safety concerns. Our United team is engaged across the industry and with government to ensure the safety of our aviation system.

In the first quarter, we reached two major milestones on the accelerated rollout of StarLink technology across our fleet, completing our first StarLink installation on a United Express aircraft and securing FAA certification to begin operations on the Embraer one hundred seventy five fleet. We're on track for our first Starlink enabled regional flight later this spring with our entire two cabin regional fleet expected to be retrofitted by year end. We continue to expect the first mainline aircraft with Starlink to take flight before the end of twenty twenty five. We believe Starlink will revolutionize the in flight experience for our customers and United is leading the way for the future of Wi Fi for the airline industry. With that, I will hand it over to Andrew to discuss the revenue environment.

Thanks, Brett. United's top line Q1 revenue increased 5.4% to a company record $13,200,000,000 TRASM for the quarter was up zero five percent. We've been hard at work adjusting how we fly in the historically weaker United Q1 period and our efforts paid off with a material year over year improvement in our margin. Demand trends did turn down as we exited January, resulting in lower revenue production than we had originally forecasted for Q1. Domestic main cabin RASMs were down 5% year over year and represent the bulk of the gap between our Q1 revenue expectations and actual results.

As we would expect in times of economic weakness, we saw the weakness magnified on off peak flights. For example, the revenue gap on domestic flights departing prior to 7AM or after 8PM outside of the golden hours is usually 30% lower. But in Q1, that gap expanded to 40% lower. That's why we are canceling more off peak flying and lower utilization going forward. Weakness in the main cabin was somewhat offset by premium performance.

Overall premium cabin unit revenues were up mid single digits in Q1. International Polaris RASMs were up 8% and international premium plus RASMs were up over 5%. Domestic premium seat RASMs were flat. Our long term strategies to build premium capacity and customer choice were very helpful given main cabin demand trends in Q1. Business traffic trends we saw late in Q4 and early twenty twenty five moderated later in the quarter.

Loan business revenue grew 7% in Q1 year over year versus 15% in Q4. Contracted business sales for all future travel are currently up low single digits year over year, which has moderated from the up double digits at the start of the year. Loyalty revenue remained strong and grew 9% to $1,500,000,000 in the quarter. Co brand spend was also strong, up 9%. Co brand spending growth in early April remained consistent with March performance.

Q2 customer demand is not what we were planning just a few months ago, but we continue to expect our top line revenue growth for Q2 to be positive. We have adjusted RM strategies going forward to accommodate more lower yield in passengers, a necessary reaction to the current environment. These the effect of these RM changes is that we will still less traffic to our competitors, but we will run with lower yields. Since making this RM change about six weeks ago, bookings have stabilized, and we are currently booked ahead of last year at this same point in time by one point. We at United have a high number of brand loyal customers, and our focus on our seven hubs put us puts us in a position where we are not a spilled carrier.

We determine how much traffic we spill to other carriers based on the amount of capacity we offer and the yield we're willing to accept. To give you a few examples, in Chicago during Q4 twenty twenty four, we expanded our passenger share lead of local origin traffic to 22 points ahead of our next largest competitor. In 2019, that lead was only six points and in 2015, we actually had a negative gap. From Denver, we've increased our gap ahead of our largest competitor in that market to 10 points for Denver based passengers. United also gained 2.1 points of market share in late twenty twenty four in the Bay Area.

United will operate our narrow body aircraft with 2% less utilization in the coming quarters effectively lowering our domestic capacity by two points. In the last few weeks, we have reduced domestic capacity for the summer in our sell in schedule by three points with one more point to be removed shortly. Among our primary competitors, we operate the highest percentage of our domestic departures in the golden hours between 7AM and 8PM. We usually have the lowest overall aircraft utilization. And lower utilization is usually considered a negative in our industry, but for United it has been one key to our relative success.

Fourth quarter domestic schedules are still being developed and we will look to see if more significant changes are needed. The international environment is also strong for United and we believe it looks good for Q2 as of now. The makeup of our international traffic skews heavily towards U. S. Point of origin business.

While most of our international travel demand is U. S.-based, we are seeing modest declines in non U. S. Origin passenger volumes. For the second quarter, international passengers originated in Europe are currently booked 6% lower than last year.

Canadian origin passenger volumes are slightly worse down 9% year over year. For United, U. S. Origin demand has more than compensated for these reductions. As we think about the impact of potential recessions could have on business traffic, it is important to note that relative to pre pandemic, our revenue makeup is less reliant on this revenue source.

Business revenue now makes up eight points less of our passenger revenue and contributes 4.4 points less to our load factor. So far, we've seen no deterioration in high end consumers' willingness to purchase a premium experience. We attribute this to the fact that the economic uncertainty has a larger impact on more budget minded discretionary travelers than those seeking a premium experience. Q2 booked premium PRASM to date have remained solidly positive for international flights and flattish for domestic flights. United has a consistent strategy for the last nine years to win brand loyal customers and that has been happening.

This is important for investors who want confidence that United's margin outperformance really can be structural, permanent and irreversible. With that, I want to say thanks to the entire United team and I'll hand it off to Mike to talk about our financial results.

first quarter, we delivered earnings per share of $0.91 ahead of expectations and within our guidance. Our pretax margin was 3%, up 3.6 points year over year and the strongest first quarter we've had in the last five years. We expect these results to lead the industry and further demonstrate the success of our United Next plan. As Andrew just described, at the February, we saw a steep drop in U. S.

Government and government adjacent travel. We guide, however, with a no excuses philosophy. So seeing the pressure on revenue, we doubled down on managing costs to ensure we would deliver within the first quarter EPS guidance range. Those efforts along with favorable timing of a few maintenance events led to our first quarter CASM ex result of up only 0.3% year over year. These actions combined with lower fuel costs enable us to deliver on our guidance.

I'm proud of the team for their hard work in making sure we delivered on our first quarter financial commitments. Looking to the second quarter, we expect earnings per share to be between $3.25 and $4.25 We are acutely focused on booking trends and the potential impact of tariffs, and we are closely monitoring the situation. And it is a risk. But to date, our bookings have stabilized. Looking out to the third quarter and beyond, we've already taken action to pull down our less profitable flying, including Redeye flying, capacity in U.

S. Government traffic heavy routes and transborder flying, aided by accelerating the retirement of 21 aircraft. We were the first airline to recognize slowing demand from U. S. Government spending and to take appropriate action.

We expect our domestic capacity come down four points from our original plan starting in the third quarter. There's a tremendous amount of uncertainty in that economy right now and we've already seen a reduction in demand and correspondingly in revenue. But we've seen stability at that lower demand level in the last six weeks. And the silver lining is, we also expect a significant reduction in our fuel cost. If demand remains stable for the balance of the year, that combination of revenue decline and fuel cost reduction along with the fact that we built a significant contingency into our initial guide leaves me cautiously optimistic that we can still deliver full year earnings per share within our guidance range of $11.5 to $13.5 While we've seen stability in demand for the past six weeks, we also recognize that there's a real risk of The U.

S. Economy going into a recession. If we enter a recession, we are modeling an additional five point reduction in total revenue for the remainder of the year on average per quarter. In that scenario, we would make an additional downward adjustment to capacity and we have not assumed any further relief in fuel price even though that might happen. Even in that world, we expect our full year earnings per share to be between $7 and $9 While that is not what our expectations were at the start of the year, that scenario would be the first time United would have remained solidly profitable through recession.

We believe it would justify significant multiple expansion as we will have proven our financial resiliency, our greatly improved competitive position and the durability of a decommoditized business powered by brand loyal customers. Turning to the balance sheet. We ended the first quarter with $18,300,000,000 in liquidity, including our undrawn revolver. We generated over $2,000,000,000 of free cash flow and paid down $1,000,000,000 of debt. In fact, over the last twelve months, we've generated over $5,000,000,000 in free cash flow, representing approximately 130% of our net income.

At our current equity valuation, that represents an over 20% free cash flow yield. Our net leverage was reduced to two point zero times from 2.2 times at the end of twenty twenty four, marking continued progress as we work towards our long term net leverage target of less than two times. Recognizing our progress, Fitch upgraded United to BB with a positive outlook, with a change to a positive outlook from Moody's as well. On the buyback, as of April 10, we've repurchased approximately 5,600,000.0 shares in 2025 at an average price of $80 History has taught us that even industry leaders are prone to steep market overcorrections in times like this, and we've built our buyback strategy around being opportunistic. We believe this is precisely the right time to repurchase our shares at our current depressed valuation with approximately $1,000,000,000 left in authorization.

Regardless of the economic path ahead, we expect our financial results to be resilient. We believe that the long term earnings power of our company hasn't changed and frankly it's possible that some of the weaker airlines may be forced to curtail money losing capacity sooner than they otherwise might have. Therefore, our view of the intrinsic value of our shares also hasn't changed. In fact, as I mentioned earlier, we believe our multiple should expand as we prove that our business is stronger and more resilient even in a time of economic stress. For as long as our share price remains depressed, we plan to continue to utilize a meaningful portion of free cash flow to repurchase shares at what we believe are discounted prices.

As I've mentioned in the last several quarters, free cash flow generation remains a top priority. While demand has softened, we continue to expect to generate full year free cash flow approaching $3,000,000,000 in a base case and positive free cash flow even in a downside recession scenario. To close, United's competitive position in the industry is only strengthening. We're focused on leaning into our network strengths, continuing to win brand loyal customers and delivering on our financial commitments. Now back to Christina to start the Q and A.

Thank you, Mike. We will not take questions from the analyst community. Please limit yourself to one question and if needed one follow-up question. Sarah, please describe the procedure to ask a question.

Thank you. The question and answer session will be conducted electronically. Your first question comes from Jamie Baker of JPMorgan. Your line is open.

Hey, good morning everybody. So first one probably for Scott or Mike. Presumably this past January you had an internal forecast for 2026 earnings. If we embrace something closer to the recessionary scenario that you just laid out, what would your internal 2026 forecast be higher, lower or the same today?

Hey, Jamie. Thanks for that question. I think it's insightful and maybe the most important question we talk about today.

Thank you. We can end the call after my question.

There you go. Going to slightly modify your timing from 2026 to say the twelve months once we're sorted to a normalized back to growth economy. I happen to think that will be for 2026, but sort of depends on the macro environment. But in the twelve months where we're back to a normal macro economy, the short answer is yes, our margins will be higher. I would go but I would go back to what we've been telling you really for the last five years.

And it started with one, we were going to decommoditize and build United into a brand loyal airlines. That's been a part of the United Next strategy. It's been a part of the entire strategy coming out of COVID. Second was cost convergence was going to be a fundamental structural change for the industry. Third is revenue diversity.

We see that we talked about international today, but we haven't talked about loyalty yet, but loyalty strong like across the board that's been another structural change. Part of this too has also part of the revenue diversity has been solving finally solving the puzzle on the price sensitive travel and we have done that with basic economy and engage. And so all the things that we've talked about for the last five years, led to us on the last call talking about comparative advantage and saying that we thought the world was going to the airline world was going to evolve to a place where airlines flew primarily in places where they had competitive advantages and, you know, the kind of capacity wars that have happened in the past would become a thing of the past because all of the trends we talked about just had separated the gap between the brand loyal airlines and everyone else. And so what this stressful environment is going to do is it is going to accelerate what was going to happen anyway of airlines focusing in markets where they have comparative advantage. And that means that looking forward there's going to be less unprofitable flying in the industry, which means less total flying than was going to happen and that is just going to happen sooner.

That means that I am confident that United Airlines is going to have higher margins than we would have had this taken longer to occur. And in fact, I will go one step further and say that when we get to the twelve months sort of post this economic period, not only are we going have higher margins, I believe they will be solidly double digit margins.

Okay. Thank you for that. And then, Mike, I know you touched on this in your prepared remarks, but your premium high margin competitor refuses to buy back stock until they meet their leverage targets. You were obviously pretty active last quarter or through April 10. I'd love to believe it's because you like our down thirty and thirty analysis.

But in all seriousness, our question on this topic is why? Is it simply a function of cash flowing around burning a hole in your pocket given the delivery delays? I guess what Mark Streeter and I are trying to reconcile is your own goal to derisk the balance sheet and achieve IG ratings against some pretty material repurchases through April 10. Any additional color?

Thanks Jamie. I love the question. Look, when we think about buyback versus deleveraging, we are trying to optimize our overall cost of capital. And therefore, as our stock price declines and the gap between our market price and our view of intrinsic value of the shares as that widens, it is more opportunistic to buy back shares. And so that's what you have seen.

You've seen an acceleration of buyback as the share price was lower. Now we are very, very disciplined around making sure we have guardrails around that. And we need to continue to deleverage. I'm very prominent about talking about getting our leverage our net leverage below two times. It's very important to us to continue to march towards investment grade.

It is very important to us that the buyback is funded by free cash flow and that we do not drift into a debt funded buyback. So all with all of those constraints, we feel confident about the future and excited about frankly an opportunity to purchase shares at these low prices.

Scott and Mike, thank you very much. Appreciate it.

The next question comes from Andrew Didora with Bank of America. Your line is open.

Hi, good morning everyone. Mike, you mentioned the cost performance in your prepared remarks, really impressive here in 1Q. I would imagine it's hard to do much better than that going forward. Is that the right way to think about it? And can you maybe speak to additional cost levers you have if the revenue environment starts to move towards your recession scenario?

Thanks, Andrew, for the question. We're very proud of our cost performance in the first quarter. But before I talk about the first quarter, let me talk about our focus on building a cost efficient culture here at United. We are being intentional about spending in areas that improve the customer experience, but we also know that there are a lot of areas to be more efficient as an airline. These opportunities are wide ranging, including, for example, improving our procurement organization and taking advantage of technology and data.

And we've always said that running a reliable operation is the best path to a low cost operation. Most importantly, running a reliable operation is the best way we can win brand loyal customers. So we feel great about it. I do think, we've had some costs that we don't think. We've had some maintenance costs that drifted from 1Q into 2Q.

And so I'd expect 1Q CASM X to be the best performance of the year. But as we sit here, I expect meaningfully better CASM X for the full year than I would have thought just in January. So we're going to continue to work hard to find more areas for efficiency, but we made a lot

Got it. Understood. And then just my second question. Just wanted to get your thoughts on the four on the five points of lower revenue production in a recessionary scenario. I guess why is that the right number to anchor to?

And I guess what's embedded from an industry perspective to get to the $7 to $9 in EPS? Thank you.

It's a great question. Maybe Andrew will want to jump on at the end. But from a high level, what you've seen from what we expected in January to what we expect in the base case now, you've seen an about five point reduction in revenue from what we thought just a few months ago. And then the recession scenario would be an additional five point reduction, starting whenever we enter into that reception, so sometime in the third quarter most likely. So if you if you add those together, which would be the appropriately appropriate way to think about it, it would be a 10 reduction from the run rate we would have expected.

Now how long we persist at that low level, you're going to have to make

own assumptions around. And listen, we're not we don't have a crystal ball on how deeper recession might be. But that's our expectation of what a normal recession might look like. We've given you the tools if you want to create a different scenario than that. But that would be our expectation of a downside case, and we wanted to be transparent with you all around the assumptions.

Hey, I want to clarify that the 10 reduction, it kicks in, in April for our recession scenario.

The next question comes from Connor Cunningham of Melius Research. Your line is open.

Hi, everyone. Thank you. Appreciate the details on the spill traffic comment. I wanted to kind of start there. You know, can you I just would've this just seems like a time in which you would, like, look to stamp out all the spill traffic carriers from your hub markets in general.

So I just thought that that was the the whole entire point of basic economy in general. So can you just talk about how you continue to move down the path of eliminating spilled traffic in general? Thank you.

So we're just trying to build a great airline for United Airlines customers. That's all we're doing. And, like, truthfully, our plan hasn't changed in five years. We make tactical adjustments like we did this time to pull out utilization flying. Everyone else does what they do.

I think it puts immense pressure on them. When United gets great, that the contrast between United Airlines and everyone else gets wider and more evident. But it's not us consciously trying to stamp out or do anything like that. We're trying to create the best airline in history United Airlines customers, and that creates a big gap to everyone else. And it's up to them to do something else.

And if they don't, well, we'll see. But we're just trying to do a great thing for United Airlines customers.

Okay. That that's helpful. And, you're probably not gonna like this question, but I've been getting it kind of on repeat. If you if you just look at the first half implied performance on EPS and then you look at what you're baking in on the second half to get to the $11.50 dollars range, it basically implies that you're going to be doing better on a year over year perspective versus 2024. So I'm just trying to understand what's driving that that that improvement if we're bouncing along the bottom in the current recession not recession, the current environment in general.

So just what additional levers do you have that you feel more comfortable now? Maybe it's premium, maybe it's loyalty, Mike, you seem to sound better on cost. Just any thoughts there in general would be helpful. Thank you.

Yes. Look, the first point I'd make is that the full year guidance in the 11.5 to $13.5 scenario counts on current booking trends holding steady. It accounts for the fact that we burned up all the contingency that we put into that full year guide. It assumes we have continued excellent cost management, but we don't uncover anything new. And it assumes that second half fuel is about $0.20 lower than first half fuel.

And then finally, it accounts for some profit maximizing capacity cuts. And so that's how we're thinking about getting to the full year guide of eleven fifty to thirteen fifty. And then we've been very clear about the downside case as well. I think that answers your question. If it doesn't, maybe clarifying.

No. You're you're good. I appreciate it. Thank you.

And by the way, that that's that was a totally fair question. We've asked ourselves that question.

Yeah. But but the but the point is I mean, I think the bigger point is we build we typically build a lot of contingency into guide and our eleven fifty to thirteen fifty doesn't really have contingency left. Our quarterly guide still does. And I'll just make a bigger point on this which is a cultural point. We expected more questions about doing two guys since no one's ever done that.

We haven't really gotten them. But I told our whole team and I'll tell our investors as well. Part of that is also when you run when you run the company with a no excuses philosophy, which is what we have. We are going to do everything possible no matter what happens to get to our numbers. And it is true that the environment has gotten a lot harder and achieving our full year, we still have, you know but we didn't think we had a real shot at getting it.

We wouldn't say it. But we do have a real shot. Bookings need to stabilize. We gotta work hard. We gotta do everything right to get there now, but we still have a real shot.

And, you know, we the most sure way to lose is throw in the towel. And at United Airlines, we no matter what the economic environment is, are gonna bust our asses to get there. And we will not miss it because we didn't try. And that's the culture and that's the philosophy and our results no matter what are gonna be better because we manage that way than if we didn't.

Yeah. I wanna emphasize one point Scott made, make sure it's clear to everyone. The full year guide no longer has a contingency in it. We burned that. But the second quarter guide with a dollar range, we normally have a $0.50 range.

We do have contingency in that figure. And so look, as we enter as we end the as we move towards the end of the second quarter, if we're coming in towards the high end of that, I feel better about the $11.50 to $13.50. And if we're coming near near the low end of that range, I feel like we're marching towards a recession scenario.

The next question comes from Dave Vernon with Bernstein. Your line is open.

Hey, good morning and thanks for taking the question. So Scott, this is a relatively unique sort of time for the industry in that you and your other sort of brand loyal airline are working with a pretty significant margin advantage relative to some of the lower cost and spill airlines that are out there. How do you think about balancing the use of that margin advantage, right? Are you thinking about using that margin to take share right now? Or are you thinking about trying to protect that margin?

When you're trying to build a better United Airlines, how do you think about that tension between having an opportunity to maybe take even more share in a market like Denver versus trying to maintain the margin?

I don't think there is a tension. And in fact, I'll go back to one point which I tried to make at the beginning. But the brand loyal airline has always won. The brand loyal airline in The United States has always had the top margins. And the brand loyal airline has always outperformed in recession.

United Airlines Holdings (UAL) Q1 2025 Earnings Call Transcript

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