United Airlines raises profit outlook despite higher fuel costs

United Airlines raised its 2026 profit outlook to $9 to $11 a share and said it expected to land near the top of that range, even after a sharp jump in fuel costs threatened to squeeze margins. The Chicago carrier said the latest run-up in oil prices could add nearly $6 billion to its full-year fuel bill versus its expectation at the start of the year, but it is still counting on strong demand and higher fares to absorb much of the hit.

Travelers have kept paying, especially for premium seats and long-haul trips. United said second-quarter fuel expense rose 84% from a year earlier to $5.11 billion, with an average price of $4.19 a gallon, and it recovered about half of that increase in the quarter. It expects to recover about 80% to 90% of the added cost in the third quarter and all of it in the fourth. United's full-year adjusted earnings target remains above the $7 to $11 range it had previously outlined.

United posted adjusted diluted earnings of $1.99 a share on revenue of $17.67 billion, up 16% from a year earlier and ahead of analysts’ expectations for earnings of $1.88 a share. United projected adjusted earnings of $2.50 to $3.50 a share for the third quarter, below analysts’ average estimate of $3.60, and said average fuel prices would be $3.69 a gallon. The recent rise in oil prices since the beginning of July alone has increased expected third-quarter costs by $575 million, or $1.12 a share in adjusted earnings. Shares fell 5% in extended trading.

The company also said it was cutting capacity plans further because of the higher fuel assumptions. United said its systemwide on-time departure rate was its best second quarter since 2021, Newark posted its best-ever second-quarter on-time performance, and more than 450 aircraft now have Starlink Wi-Fi installed, with nearly 1,000 expected by year-end. United is targeting an investment-grade rating in 2026.