American Airlines Guides to Another Q4 Loss on $4.70 Jet Fuel, Plans Slower 2027 Growth

Since jet fuel surged when the Iran war began, four major U.S. airlines have cut their 2026 outlooks. American's third-quarter report on Thursday, Oct. 22, adds the detail on how much of the damage is fuel and how long the company expects it to last.

The short version: American is not forecasting a recovery this year. It projects another adjusted loss in the fourth quarter of 50 cents to $1.10 a share.

The fuel math

Fuel expense rose $1.9 billion, or 67.5%, to $4.6 billion in the quarter. American paid an average of $3.85 a gallon, up from $2.37 a year earlier.

The fourth quarter looks worse. Using the forward fuel curve as of Oct. 19, American expects to pay about $4.70 a gallon, close to double the fourth quarter of 2025. At that price, fuel expense would climb roughly $2.8 billion year over year.

Revenue is doing its part. Third-quarter revenue rose 19.3% to $16.3 billion, above the high end of the company's own guidance. For the fourth quarter, American expects revenue growth of 19.5% to 22.5%.

It still isn't enough. The GAAP net loss for the quarter was $269 million, or 41 cents a share, against a $114 million loss a year earlier. Adjusted, the loss was $182 million, or 28 cents a share.

Through nine months, American has lost about $580 million, compared with net income of $12 million in the same period of 2025. The first quarter was a $382 million loss, the second a $71 million profit.

Fares are up, and still behind

U.S. airfares rose an average of nearly 23% year over year in the seven months through September, according to Labor Department data. Airlines have pushed prices up sharply since the war started to protect margins. The increases have not kept pace with fuel.

The carriers now face a pricing question. Delta CEO Ed Bastian warned earlier this month that airlines may need to curb flight growth further next year to sustain higher fares and protect profitability. United has also warned the industry may need to cut capacity.

American is moving the same way. The company said network growth in 2027 will slow from 2026 levels because of elevated fuel prices.

Management's case

CEO Robert Isom framed the quarter as progress. "American delivered record third-quarter revenue and the strongest year-over-year revenue growth in my career, with premium performance leading the way," he said in a statement. He said the investments across the company's four commercial pillars "are working."

Isom attributed the loss to energy costs. "While historically high fuel prices significantly impacted our financial results, our focus remains on restoring profitability," he said.

CFO Devon May said American expects to lead the network carriers in the spread between unit revenue growth and growth in unit costs excluding fuel, special items and profit sharing. The company also said it delivered the best unit cost performance among the network carriers in the quarter.

The balance sheet gives it room. American ended the quarter with $11.8 billion of total available liquidity. It expects nearly $1 billion in annual run-rate savings from its reengineering efforts by the end of 2026.

The travel site One Mile at a Time pointed to the gap with peers. It wrote that Delta, Southwest and United still plan healthy profits this year, which leaves American as the one now joining the list of money-losing U.S. airlines.

Smaller carriers feel it too

The squeeze is not limited to the big four. Arajet, the Dominican Republic carrier founded in 2022, told Aviation Week it had expected to turn an annual profit this year and will not.

"We were supposed to [achieve profitability] this year, but because of fuel costs we are not there yet," Chief Communications Officer Manuel Luna said at an industry forum in Mexico City. He said revenue performance is strong and that Arajet would be profitable "very quickly" if jet fuel returned to pre-war levels.

Arajet still plans to grow, with eight Boeing 737-8 deliveries in 2027 and new U.S. routes on the East Coast and in the Midwest. That makes it a contrast with American's plan to slow growth.

American's guidance now rests on a fuel price of $4.70 a gallon. The airline has not said what it would do if the forward curve moves higher. American shares were down 3.3% to $11.83 in premarket trading Thursday. Its 2026 outlook is now an adjusted loss of $1.00 to $1.60 a share, versus its July range of a 65-cent profit to a 65-cent loss.