JetBlue Airways (NASDAQ:JBLU) fell 5.6% in early trading after swinging to a loss in the final quarter of last year and warning of lower capacity in 2024.
The New York-based airline reported a net loss of $104 million in the last three months of 2023, compared to a $24 million profit in the same period a year earlier.
Capacity increased 3.3% year over year in the quarter but revenue fell 3.7% to $2.3 billion, which was slightly better than Wall Street expectations. Operating expenses were cut 2.4%.
Faced with operational challenges and shifting travel patterns, JetBlue is adjusting its strategy.
The airline plans to defer $2.5 billion in aircraft spending and has reduced its capacity forecasts for 2024 to fall by low single digits.
This strategic shift follows a recent legal setback, where a federal judge blocked its $3.8 billion plan to acquire Spirit Airlines, complicating the airline's expansion plans amidst a challenging market.
Joanna Geraghty, JetBlue’s president, chief operating officer and CEO-designate, said: "2024 is an important year of change for JetBlue and we are taking aggressive action, including launching $300 million of revenue initiatives, to return to profitability and deliver value for our shareholders."
She said demand during peak periods remains strong but effort is required to manage capacity during off-peak periods due to "evolving demand trends", which is why capacity is being cut.