JetBlue Stock Plummets 19% in 2025 After Revenue Forecast Cut Amid Latin America Travel Slump
JetBlue's shares dropped sharply after the airline lowered its revenue outlook for 2025, citing weaker-than-expected travel demand in its crucial Latin American markets. Discover the latest financial insights and strategic moves by JetBlue to navigate this challenging period.
Bill McColl brings over 25 years of expertise as a senior producer and writer across TV, radio, and digital platforms, leading teams to cover major news events with professionalism and depth.
Highlights
- JetBlue's stock fell over 19% following a warning about declining revenue for both the current quarter and full year due to reduced travel demand in Latin America.
- CEO Joanna Geraghty acknowledged the airline had overestimated flight capacity to Latin America, which is expected to continue pressuring revenues.
- The airline reported a $716 million loss, largely driven by one-time expenses including costs from canceling its planned acquisition of Spirit Airlines.
JetBlue Airways (JBLU) experienced a significant stock decline of more than 19% after revising its guidance downward amid a slowdown in Latin American travel demand. The company now expects quarterly revenues to drop between 6.5% and 10.5%, surpassing analysts' forecasts for a modest decrease. For the full year, JetBlue anticipates a low-single-digit revenue decline, marking a change from its earlier flat revenue outlook and missing Wall Street expectations.
CEO Joanna Geraghty, who assumed leadership in February 2024, stated that the airline had planned too many flights to Latin America, a key part of its network. She warned that the elevated capacity in this region would likely continue to weigh on revenue performance throughout the year.
JetBlue President Marty St. George highlighted that the company initiated cost-cutting measures early in the year, including significant network adjustments aimed at eliminating unprofitable routes and focusing on strong leisure markets where JetBlue has historically succeeded.
The first quarter results showed a net loss of $716 million, primarily influenced by one-off charges such as those related to terminating the proposed $3.8 billion Spirit Airlines acquisition, which was blocked by regulatory authorities over competition concerns. Excluding these charges, JetBlue posted an adjusted net loss of $145 million, or 43 cents per share, which was less severe than analyst predictions. Revenue for the quarter declined 5.1% year-over-year to $2.21 billion, aligning with estimates.
As of mid-afternoon trading on Tuesday, JetBlue shares were priced at $6.06, down 19.1%, but the stock remains up for the year 2024.
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