JetBlue revises Q2 guidance, slight improvement to revenue outlook

JetBlue has updated its second quarter 2024 guidance with a marginally upward revision on June 3, 2024. It now expects available seat miles (ASMs) to be down 4%-2% year-on-year (YoY), a slight improvement from its previous estimation of a 5%-2% decline. Its previous revenue projection was expected to be down 10.5%-6.5% YoY; it has now improved the guidance to a negative 9.5%-6.5%. The revised outlook was driven by JetBlue's ""strong operational performance quarter-to-date with a completion factor of approximately 99%,"" it said in an 8K form filing. It said the improved operational performance is driving ""solid cost execution in the second quarter"", further supported by fuel prices lowering through the second quarter. TD Cowen analysts added: ""Weather and air traffic control (ATC) have cooperated thus far, albeit we are heading into a typically challenging period for pop up thunderstorms."" Its cost per available seat mile (CASM) excluding fuel improved from a positive 5.5%-7.5% YoY increase to 5%-7%. Fuel cost per gallon improved from its previous guidance of $2.98-$3.13 down to $2.85-$2.95. JetBlue added that demand continues to be healthy overall and is meeting expectations, with Florida noted as being a positive market for the airline. TD Cowen analysts added: ""Management has been implementing a number of network changes since moving on from the Spirit merger. One more round of changes is expected this year."" With overcapacity in US-Latin America routes, JetBlue said this overcapacity is more prominent in beach markets rather than the visiting friends and relatives (VFR) market of which the airline holds a majority in terms of capacity.