United Airlines targets top end of 2026 profit forecast as travel demand offsets fuel cost surge

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United Airlines 2026 profit forecast

Highlights

United Airlines expects 2026 adjusted EPS at the top end of its $9 to $11 range despite a $6 billion fuel bill increase.
Shares fall 5% in extended trading after United issues weaker Q3 earnings outlook of $2.50 to $3.50 per share versus analyst estimate of $3.60 per share.
United recovers 50% of Q2 fuel cost increases, expects to recover up to 90% in Q3, and forecast revenue per available seat mile growth to accelerate in H2 2024.

2026 outlook holds despite fuel pressure

As reported by Reuters, United says it now expects 2026 adjusted earnings per share at the high end of its previous $9 to $11 range, despite forecasting its fuel bill will be about $6 billion higher than it expected at the start of the year.

The top end of that range is about 5% above the $10.46 per share expected by analysts surveyed by LSEG. Shares fall 5% in extended trading after the company also issues a weaker-than-expected third-quarter earnings outlook.

For the third quarter, United forecasts adjusted earnings of $2.50 to $3.50 per share and an average fuel price of $3.69 per gallon. The midpoint of $3 compares with analysts' average estimate of $3.60 a share, according to LSEG.

The airline reports second-quarter adjusted earnings of $1.99 per share, ahead of analysts' estimate of $1.88. Revenue rises 16% to $17.7 billion.

Pricing power and capacity shape airline response

United says it recovers about 50% of the increase in fuel costs during the second quarter and expects to recover 80% to 90% of the current increase in the third quarter. It expects to fully offset the increase by the fourth quarter.

The carrier says oil prices have risen about 15% since the start of July following renewed hostilities between the U.S. and Iran, and it bases its third-quarter and full-year forecasts on prices as of Tuesday, July 14. Rising costs increase United's expected fuel expenses by about $575 million over the past two weeks, and the airline says its third-quarter earnings estimate would have been $1.12 per share higher if fuel prices had remained steady from the beginning of July.

Major U.S. airlines are benefiting from strong pricing power after fare increases during this year's fuel shock, and investors are watching whether carriers can continue passing through higher costs without weakening demand while keeping capacity growth in check. United says its total revenue per available seat mile is expected to grow faster year on year in both the third and fourth quarters than the 12.1% increase posted in the second quarter, while fourth-quarter schedules currently on sale are expected to be reduced from present levels.

United is due to discuss its financial results in a call with analysts and investors on Thursday morning.

In our earlier article on transportation producer-price inflation, we highlighted that freight services and transport equipment costs were rising, with the Producer Price Index for these inputs up 2.3% year over year in June 2026. We also noted that transportation services were a meaningful driver of broader producer inflation, with especially large increases in truck and air transportation costs, underscoring sustained cost pressure across the sector.

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