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United Airlines (Nasdaq: UAL) stock soared over 11% in early trading on Wednesday, approaching its 50-day moving average following the company’s impressive first-quarter earnings report.

The airline giant reported a diluted loss per share of $0.38, with an adjusted loss of $0.15 per share after accounting for specific items, outperforming analyst expectations. United’s revenue also exceeded expectations, rising by 9.7% to $12.54 billion compared to the anticipated $12.45 billion.

UAL Earnings Lead to Rally in Airlines Stock

The positive sentiment from United’s earnings report spilled over to other major U.S. airlines. Delta Air Lines (NYSE: DAL) saw a 3.01% increase on Wednesday morning, building on the momentum from last week’s earnings report, which showcased an 80% increase in earnings. American Airlines (Nasdaq: AAL) rose by 4.8% during the trading session at the time of writing.

United Airlines provided an optimistic outlook for the second quarter, projecting adjusted earnings per share between $3.75 and $4.25, surpassing Wall Street’s expectations of $3.69. The company also maintained its full-year earnings forecast of $9 to $11 per share, with analysts estimating around $9.16 per share.

This positive guidance comes despite the airline recording a $200 million hit due to the grounding of Boeing 737 Max 9 aircraft, which influenced its quarterly financial results.

United Slahsed Delivery Expectations for FY 2024

In response to market conditions, United has strategically adjusted its operations, including slashing its aircraft delivery expectations for the fiscal year 2024. This move demonstrates the company’s adaptability and proactive approach to navigating the challenges posed by the aviation industry.

The strong performance and optimistic outlook from United Airlines have injected confidence into the U.S. airline sector, with investors rallying behind the industry’s recovery prospects.

As the travel industry continues to rebound from the impact of the COVID-19 pandemic, the positive earnings reports and strategic adjustments made by major airlines like United, Delta, and American are expected to drive further growth and investment in the sector.

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