American Airlines shares plunge on a gloomy forecast — but its credit-card biz is thriving

Middle seat, last row… where American Airlines is mentally after earnings. The airline’s stock descended 9% yesterday after it unloaded a bummer forecast: it expects a larger-than-expected loss for this quarter as its costs rise. Last quarter wasn’t bad: Q4 profit surged and sales rose 5%. For the full year, it notched a record $54B in sales. But investors are focused on the flight plan and American’s direction was disappointing, especially compared to that of its rivals.

• Delta Air Lines and United earlier this month gave rosier-than-expected outlooks on booming demand. Delta’s longtime CEO, Ed Bastian, said he expected 2025 to be “the best financial year in our history” as global travel keeps booming.

• United unloaded a record Q4 profit that was up 64% on the year thanks to falling fuel costs. For the full year, it flew 174M passengers — also a record. Delta’s Q4 profit dropped from a year earlier, but investors boosted the stock on solid sales growth and a sunny outlook.

Swipes in the spotlight… We’re sensing a theme in airline earnings: credit-card revenue is becoming increasingly important. American’s compensation from its co-branded-card deals with Citi and Barclays popped 17% from 2023, hitting $6B+ last year. Meanwhile, Delta’s credit-card biz grew by about $1B last year as it pulled in $7.4B from its American Express partnership. With all the cash airlines are raking in from rewards cards and loyalty programs, flight-ticket sales aren’t as front row as they used to be.