JetBlue Airways (NASDAQ:JBLU) shares have slumped 16% after it lowered its full-year sales forecast, likely delaying the group’s journey back to profitability.
In the 2024 financial year, revenues are expected to fall by a low single digit, representing a drop compared to analysts’ guidance.
Previously in January, JetBlue had said it expected sales would come in flat over the full year.
“As we look to the full year, significant elevated capacity in our Latin [America] region, which represents a large portion of JetBlue’s network, will likely continue to pressure revenue and we expect a setback in our expectations for the full year,” Joanna Geraghty, the group’s chief executive, said.
Looking at the second quarter, management is predicting sales will drop by 10.5% year-on-year. This represents more than double the decline Wall Street was expecting.
It comes despite JetBlue having launched a company-wide cost-cutting plan, which aims to cancel unprofitable journeys and instead focus on high-demand routes and premium-priced offerings.
Last month, the group was forced to abandon its planned US$3.8 billion merger with Spirit Airlines after it was decided the deal would breach antitrust rules.