United Airlines Holdings, Inc. (NASDAQ:UAL) Q2 2023 Earnings Call Transcript

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And we’ve incorporated our expectation on lower capacity in our EPS guidance for the third quarter and full year. And so it’s fair to say that — but for those adjustments, our guidance for the full year of top half of the range, yes, it could have been a little bit higher because of those changes. But that’s the way to look at it.

Catherine O’Brien : That’s really helpful. And then maybe one for Andrew. Can you just walk us through some of the assumptions you’re making underlying the view that domestic RASM performance is steady or better 3Q versus 2Q? What’s the corporate assumption? And really just asking because that’s different from what some of your peers are expecting. So just wondering what’s unique to United that that’s going to hold in a little bit better than some others are seeing?

Andrew Nocella : Well, I won’t go through my long list of what’s unique to United, again, I think that may be a little bit too much. I would love to, but look, we’re looking at the numbers for Q3. What I would tell you is that there’s clearly been some shift out of Q3 into Q4. October is, I think, setting up to be a stronger month of the year than it was in 2019. And June is now the strongest month of the year itself. So that is causing some shifts in seasonality and margin, I think, for United and for the industry. But overall, we just — I think we have a really good setup. Our international system is just performing outstandingly. There’s not like a single part of the globe, a single part of the network that’s not working.

And we’ve leaned into it really strongly. And I think that’s shown up in the results. And on the domestic front, I think this is just — we have the right aircraft in the right places. New York City, in particular, is doing dramatically better than it had been in the past for us. So we’re really pleased by that. And all the hubs, as I said, are profitable and performing well. So we just think very good capacity plan and a really strong environment.

Operator: Our next question comes from Ravi Shanker from Morgan Stanley.

Ravi Shanker : So just to kind of follow up on the July 4 disruptions. I don’t know if it’s a fair question, but are you able to quantify kind of what percentage of the disruption was sort of in your hands or factors within your control versus like what was fostered upon you, if you will, or externally imposed? And also kind of in the near term, it does make sense to draw down capacity, but kind of what is the long-term plan to make sure that Newark serves as an effective hub for you?

Scott Kirby : Well, first, most important thing is to get Newark working effectively. And we’ve done some tactical things at United already. We’ve got some more changes that are coming that are in the schedule that are kind of embedded in the cost that Gerry talked about. But I think the biggest thing that has happened in Newark just this month is a level of communication, coordination with the FAA is the highest it’s ever been. That does it was planned. And our thunderstorms are tough. And if there’s thunderstorms, they close departure routes in an airport, you’re going to be canceling all flight. But if you can plan in advance and not have airplanes in the air, you wind up not having to divert airplanes. And that’s where you get in trouble as we have to do that.

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