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United shares tumble after airline forecasts first-quarter loss

United Airlines shares fell about 4% on Tuesday after the carrier forecast a first-quarter loss, citing weaker demand growth compared with other months and higher fuel costs.

The company also said it will accrue expenses tied to a possible new contract with its pilots in the first quarter, earlier than it previously forecast, although negotiations are ongoing.

The carrier expects an adjusted quarterly loss of between 60 cents and $1 per share, down from its previous projections of adjusted earnings of between 50 cents and $1 per share for the first three months of the year.

“While all months of 2023 are expected to produce unit revenue significantly above the corresponding months in 2019, the Company is observing new seasonal demand patterns, with lower-demand months such as January and February 2023 growing less than higher-demand months,” United said in a securities filing after the market closed on Monday.

The carrier said as a result it trimmed its estimate for unit revenues to between 22% and 23% over a year earlier, down from previous guidance of a 25% increase.

As travelers return to more traditional booking patterns, such as traveling close to holidays and other popular vacation periods, second-quarter revenue will likely be higher than United previously expected with operating revenue up in the “mid-teens” over last year, the company said.

The airline said it still expects to earn between $10 and $12 a share this year, on an adjusted basis.

The Chicago-based carrier is scheduled to present at a JP Morgan industry conference on Tuesday along with other airlines including Delta, Americanand JetBlue.

Delta forecast a loss of $100 million to $200 million for the first quarter and reaffirmed its estimate for per-share earnings of 15 cents to 40 cents on an adjusted basis.

CEO Ed Bastian told CNBC’s “Squawk Box” on Tuesday that travel demand has been resilient.

This article originally appeared on CNBC

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