United Airlines announced Tuesday its third quarter results, better than analysts’ expectations, and a $1.5 billion share buyback, the first in the wake of the Covid-19 pandemic.
The company reported net income of $965 million in the quarter, down 15% year-on-year, and revenues of $14.84 billion, up 2.5%, both of which beat estimates.
The airline’s chief financial officer, Michael Leskinen, said the company “is in a position to add a share repurchase program” as it continues to invest in the business and reduce its financial leverage.
→ United adds eight new destinations in largest international expansion in its history
“Over the past four years, we have invested $22 billion in our product and nearly $10 billion in our people. These investments have led to increased profits and now contribute to increased free cash flow,” Leskinen said.
The share buyback is United’s first in the wake of the pandemic, a period in which the U.S. government gave the nation’s airlines more than $50 billion in government aid on the condition that it suspend share buybacks and dividends.
Another U.S. airline, Southwest, recently announced a $2.5 billion share buyback.
United upgraded its fourth-quarter forecast and said it expects to earn between $2.50 and $3.00 per share in this time period, versus the $2.76 forecast by FactSet analysts, EFE reported.
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