United Airlines (UAL) - Q3 2025 Earnings Call
Concise AI-driven summaries of earnings and conference calls, highlighting the numbers, context, and signals that matter most.
Call Details
Call Title: United Airlines Q3 2025 Earnings Call
Date held: October 16, 2025
Management team members present:
Scott Kirby - Chief Executive Officer
Brett Hart - President
Andrew Nacella - Executive Vice President and Chief Commercial Officer
Mike Leskinen - Executive Vice President and Chief Financial Officer
Christina Edwards - Managing Director of Investor Relations
Call Summary
Financial Performance
United Airlines reported strong third-quarter earnings, highlighted by an earnings per share (EPS) of $2.78, exceeding their guidance range and Wall Street expectations.
Revenues increased 2.6% to $15.2 billion, on a 7.2% increase in capacity, with international routes seeing some declines but domestic operations maintaining momentum.
The pre-tax margin was cited at 8%, which would have been higher if not for disruptions at Newark.
United achieved a significant milestone by having all seven of their hubs profitable during the quarter.
“Our major cost focus at United is to drive real cost efficiency through our use of technology,” emphasized CEO Scott Kirby.
Guidance
United expects fourth-quarter EPS between $3.00 to $3.50, moving towards the better half of their full-year 2025 guidance range of $9 to $11.
The company aims for full-year EPS growth, positioning it as the only airline expecting to grow earnings for the year.
CEO Scott Kirby projected that United’s strategic focus will help achieve double-digit pre-tax margins long-term.
Capital Allocation
The company continues to aim for an investment-grade balance sheet, with aggressive deleveraging strategies in place.
United is making strategic capital investments in customer experience, technology, and operational efficiencies, exceeding $1 billion annually.
They reported a significant move, buying back three 787 aircraft, which is expected to accelerate deleveraging.
“Free cash flow generation remains a focal point, promising over $3 billion this year,” stated CFO Mike Leskinen.
Macro & Demand Trends
Despite macroeconomic volatility, United has managed to retain strong financial performance.
CEO Scott Kirby highlighted the shift towards brand loyalty over commodity-based competition in the airline industry.
The summer saw record levels of travel, and the company’s resilient operational performance amid volatility was emphasized.
“Winning brand-loyal customers sets up our revenue advantage,” noted Kirby.
Competition
United Airlines highlighted its comparative advantage through substantial investments and focus on customer loyalty programs.
The airline is strategically positioning itself to excel over commodity-based airline models.
CEO Scott Kirby noted, “The industry’s restructuring process... is in the early stages.”
AI Trends
United is utilizing artificial intelligence to optimize operations, most notably through tools like ORCA for aircraft routing and crew pairing.
These AI-driven solutions have contributed to United’s ability to recover swiftly from operational disruptions.
Expense and Headcount Trends
Despite large investments in customer experience, United achieved a negative 0.9% CASMAX performance.
Management expects CASMX to trend at 2% to 3% annually, considering both inflation and cost-saving measures.
United has also been working on efficiency by reducing management headcount by 4% and plans similar reductions next year.
Product Updates
United’s progress in enhancing the customer experience via new technologies, like Starlink for in-flight Wi-Fi, was emphasized.
Investments in other services, such as improved food and club access, are set to double in the coming years.
“Starlink could be the biggest game-changer for United since it’s the fastest and most reliable for our MileagePlus members,” stated Brett Hart.
International Trends
Despite PRASM declines in international flights, adjustments have been made to strengthen year-round demand.
United plans on reducing capacity marginally on some international routes to boost margins.
CEO Scott Kirby pointed out the challenges with Russian overflight restrictions affecting route efficiency.
Notable Quotes
“We delivered strong third-quarter results despite macro volatility... a clear proof point on our path to solid double-digit margins.” - Scott Kirby
“Our transformation is making the world a smaller place for United Airlines.” - Andrew Nacella
“This quarter, I’m particularly proud of our team for our disciplined cost management.” - Mike Leskinen
“We expect our consolidated RASM to meaningfully improve in Q4 year over year.” - Andrew Nacella
“Starlink could be the biggest of them all... a game changer for United.” - Brett Hart
“The industry’s restructuring... is only in the second or third inning.” - Scott Kirby
“United now operates 765 jets with more than 146,000 seat-back screens.” - Andrew Nacella
“I want to thank the team for the continued execution through what has been an earnings recession for the airline industry.” - Mike Leskinen
“The fact that we’re going to grow earnings this year, I think, is quite remarkable.” - Scott Kirby
“Our loyalty program is set to double the EBITDA by the end of the decade, signifying expansive growth.” - Andrew Nacella
Q&A Summary
Q: Catherine O’Brien (Goldman Sachs), on main cabin versus premium margins in light of changes in main cabin supply.
A: Scott Kirby noted that most investors and executives viewed the airline industry as a commodity; however, United’s strategy focuses on creating brand loyal customers, hence transforming it from a commodity to a loyalty-based industry. Kirby stated that commoditized seats have lower margins but anticipates balancing and profitability moving forward for all airlines.
Q: Jamie Baker (J.P. Morgan), about the relationship between premium leisure and corporate yields.
A: Andrew Nacella explained that premium leisure is becoming more profitable than traditional corporate travel in domestic markets, though this trend is yet to fully extend to international long-haul routes. However, United is leaning into this trend by reconfiguring aircraft and market strategies.
Q: Andrew DeDora (Bank of America), regarding air traffic liabilities and Latin America capacity issues.
A: Andrew Nacella confirmed strong booking demand into Q4 leading to a lower than usual drop in air traffic liabilities. He acknowledged the challenge in Latin America but signaled improvement prospects as certain unprofitable routes will be removed.
Q: Sheila Kayalu (Jeffries), about sequential unit revenue trends in Q4 and operational capacity changes.
A: Scott Kirby and other executives expressed confidence in achieving RASM improvements in Q4 through strategic adjustments and brand loyalty incentives. They acknowledged external events affecting past performances but indicated proactive capacity management for 2026.
Q: Dwayne Finningworth (Evercore ISI), on forward bookings and costs into 4Q and 2026.
A: Mike Leskinen addressed a temporary maintenance shift impacting financials but maintained confidence in catching up performance in Q4. Labor contract costs were acknowledged as future expenses, but the company emphasized its continued earnings growth.
Q: Connor Cunningham (Melius Research), inquiring on loyalty program and hub capacity strategy.
A: Scott Kirby and Andrew Nacella highlighted United’s ongoing loyalty program strategies while discussing future capacity enhancements, especially focused on achieving critical mass and gauge adjustments by 2026.
Q: Scott Group (Wolf Research), regarding loyalty EBITDA contribution and cost pressures from labor.
A: Andrew Nacella withheld specific figures on current loyalty EBITDA, indicating these themes will be addressed in future strategic disclosures. Mike Leskinen clarified the expected incremental labor cost impact due in 2026.
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