Updated Version 1 - American Airlines predicts losses in 2026 due to fuel cost increases outpacing ticket price growth.

The full text supplements details and background information

Reuters, October 22 - American Airlines AAL.O predicted a loss for 2026 on Thursday, abandoning its previously forecast range that anticipated profitability, due to surging jet fuel prices outpacing ticket price increases and squeezing profit margins.

The airline's shares fell 3.5% in pre-market trading.

Since the outbreak of the Iran war (link), airlines have significantly raised ticket prices to protect margins, but even so, it has been hard to keep up with soaring jet fuel costs. The turbulent market environment also makes it difficult to predict future fuel expenses.

With no sign of the war ending, American Airlines must weigh how much of the rising fuel costs to pass on to passengers by raising fares without dampening the travel demand that has so far supported the market.

Delta Air LinesDAL.N and United AirlinesUAL.O and other major rivals havewarned that the industry may need to cut capacity further to maintain pricing power and control costs.

Delta CEO Ed Bastian warned earlier this month that airlines may need to further restrict flight growth next year to keep fares high and ensure profitability.

According to US Department of Labor data, in the seven months ending September, US airline ticket prices rose by nearly 23% year-over-year on average.

American Airlines now expects an adjusted per-share loss of $1.00 to $1.60, compared to its previous forecast of earnings of $0.65 per share to a loss of $0.65 per share.

The airline reported a net loss of $269 million, or $0.41 per share, in the quarter ending in September, compared to a loss of $114 million, or $0.17 per share, a year earlier.

Thanks to fare increases, revenue in the quarter grew by 19.3% to $16.3 billion.

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