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STT757
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UA 2Q Profit $919 Million

Thu Jul 24, 2014 12:09 pm

UA needed a good quarter, and they got it;

Net income $919 million, $789 million after special items (RJ retirements).

PRASM up 3.7%

http://ir.unitedcontinentalholdings....-newsArticle&ID=1950817&highlight=
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jetblue1965
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 12:10 pm

What ?? UA net income ex specials is higher than DL ???

Did the sun just rise from the south ?
 
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jetblastdubai
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 12:20 pm

This should help employee morale as well...good news normally lifts everyone.
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EK413
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 12:24 pm

Wow, I wasn't aware UA was performing this good!

Congratulations UA!

EK413
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MaverickM11
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 12:28 pm

Quoting Jetblue1965 (Reply 1):
What ?? UA net income ex specials is higher than DL ???

Did the sun just rise from the south ?

Careening toward imminent bankruptcy  That said DL's operating income is obviously quite a bit higher, as well as RASM improvement, and ops stats..

[Edited 2014-07-24 05:30:16]
E pur si muove -Galileo
 
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aerorobnz
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 12:47 pm

Hopefully some of that can go back into the Gold Lounges to offer more than pepperjack cheese and crackers and carrot sticks..

That's a good result though - certainly something for UA to be proud of. I daresay that the 739 and 787 deliveries are helping no end.
Flown to 147 Airports in 62 Countries on 83 Operators and counting. Wanderlust is like Syphilis, once you have the itch it's too late for treatment.
 
jayunited
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 12:50 pm

Wow I don't think anyone was expecting UA 2Q to be this great, I can't even remember the last time UA had a quarter where the numbers were this good.

Although we still have a long way to go to get UA on the right path this is certainly good news and employees needed this good news especially those of us have been working hard trying to make UA a better airline and a better place to work. This quarter truly was a step in the right direction.
 
B737900ER
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 12:56 pm

Quoting jayunited (Reply 6):

Makes you wonder what UA is really capable of once they get their act together. Those are good numbers considering some of the inefficient practices that still exsist.
 
panamair
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 1:08 pm

Quoting Jetblue1965 (Reply 1):
What ?? UA net income ex specials is higher than DL ???

Due to DL's hefty $497m tax provision (UA had $2m) this past quarter.
 
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CALTECH
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 1:35 pm

What ? Delta had more revenue but less profit than United ? It underperformed compared to United ? The Delta CEO must go. Delta better revamp it's business model and close some hubs or bankruptcy might be around the corner.   
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jetblue1965
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 1:44 pm

Quoting panamair (Reply 8):
Due to DL's hefty $497m tax provision (UA had $2m) this past quarter.

still refusing to give credit where credit is due ? UA has net income inc specials that's very much in-line with AAL and DAL, which according to A.net is as rare as an unicorn on a rainbow
 
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STT757
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 1:44 pm

UA is also initiating a $1 Billion stock buy back.
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CALMSP
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 1:46 pm

Quoting CALTECH (Reply 9):

YUP. The end is near.   
 
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jetblastdubai
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 1:49 pm

Quoting STT757 (Reply 11):
UA is also initiating a $1 Billion stock buy back.

Stock hit 52-week high moments ago.
Every zoo is a petting zoo......if you're a man!
 
usairways85
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 2:07 pm

Quoting jetblastdubai (Reply 13):
Stock hit 52-week high moments ago.

With a Market Cap that is still almost half of where DL and AA are at.
 
AMALH747430
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 2:20 pm

Good news! I hope this is a sign of better things to come. UA has so much potential. It's hubs are located in large, lucrative markets. It has a great route network and a great network of JV and codeshare partners. I flew UA 132 IAD-MUC in Y+ last June. The cabin was very clean, the IFE system was top notch and the EWR based flight attendants were very professiknal, courteous and attentive. I have flown UA several times domestically within the last year and have walked off of all my flights satisfied. UA is far from a lost cause. It is taking them a while to catch their stride but they'll get there!
 
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STT757
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 2:54 pm

Quoting jayunited (Reply 6):


Wow I don't think anyone was expecting UA 2Q to be this great, I can't even remember the last time UA had a quarter where the numbers were this good.

It's especially impressive given their mainline on time performance was only 76.4%, due in large part to runway closures at EWR and SFO.
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175erj
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 2:56 pm

Quoting AMALH747430 (Reply 15):

It doesn't matter how much money you make if your product/service is crap. They will continue to drive away HVC to other airlines such as Delta and American, and they will suffer because of it...
 
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CALTECH
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 2:59 pm

Quoting 175erj (Reply 17):
It doesn't matter how much money you make if your product/service is crap. They will continue to drive away HVC to other airlines such as Delta and American, and they will suffer because of it...

You mean like Delta and American did a few years ago ? Did they suffer much ?
  
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Criminals are the deadly cancer on American society
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Rdh3e
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 2:59 pm

Quoting 175erj (Reply 17):
It doesn't matter how much money you make if your product/service is crap. They will continue to drive away HVC to other airlines such as Delta and American, and they will suffer because of it...

Listening to the earnings call, corporate revenues are up across the board. HVC are coming back to United, not continuing to leave as you suggest.
 
AeroWesty
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:01 pm

This thread sure puts to rest the old saying that 'everyone loves a comeback story'.

Congrats to UA for a great quarter, credit where credit's due!
International Homo of Mystery
 
Bobloblaw
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:02 pm

Quoting STT757 (Reply 11):
UA is also initiating a $1 Billion stock buy back.

I think that is a mistake. They should invest in their product and larger narrow body planes.
 
FlyPNS1
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:05 pm

Quoting bobloblaw (Reply 21):
I think that is a mistake. They should invest in their product and larger narrow body planes.

UA's management isn't interested in the long term. The goal is to make lots of cuts to control cost and pump up the stock, so that they can cash out. Notably, Smisek recently bought more UA stock...knowing full well the buyback would help pump up share prices.
 
Rdh3e
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:06 pm

Quoting bobloblaw (Reply 21):
I think that is a mistake. They should invest in their product and larger narrow body planes.

It's happening already. All the narrowbodies that aren't retiring have been getting new seats and wifi, we're taking in the neighborhood of 3-4 new 739s every month.

Point is, UA has $6B in cash, with a lot of it just sitting and not "working" (compared to DL at around $3B now) so it needs to go somewhere and this is the best place. Consider that UA considers it's "cost of capital" to be about 10-12%, so buying stock is viewed as buying back "debt" that has an effective rate of 10-12% which is the most expensive "debt" on the books, even though any payments on that debt are completely voluntary  

[Edited 2014-07-24 08:08:32]
 
Bobloblaw
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:12 pm

Quoting RDH3E (Reply 23):
Point is, UA has $6B in cash, with a lot of it just sitting and not "working

A by product of ZIRP. Lots of cash, cant earn a return on it, so buy back stock. And Yellen says QE and ZIRP arent causing the market to go up.
 
usairways85
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:20 pm

Quoting RDH3E (Reply 23):
All the narrowbodies that aren't retiring have been getting new seats and wifi, we're taking in the neighborhood of 3-4 new 739s every month.

Have you sat in the new seats or tried to use the wifi? The new seats aren't investing in their product they are a cost cutting measure to cram more seats onto planes. And let's not forget none of the E170/E175/CR7s have wifi.


That's besides the point. Yes UA had a good quarter, but it is evident that the management is in this for the short haul.

[Edited 2014-07-24 08:22:46]
 
Rdh3e
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:24 pm

Quoting usairways85 (Reply 25):
Have you sat in the new seats or tried to use the wifi? The new seats aren't investing in their product they are a cost cutting measure to cram more seats onto planes.

Well they add expense to the business on a total expense basis. I think you mean "the help alleviate unit cost growth". I've used the seats on 4+ hour sectors and they are fine. They actually get better over time as the cushions break in. I know that is of no comfort (sorry for the pun) now, but it's just how it goes.

Wifi reliability is getting better, UA was the first major to use this product so glitches are expected. I'll grant that it was foolhardy to make a glitchy system the only choice.
 
AeroWesty
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:33 pm

Quoting bobloblaw (Reply 21):
They should invest in their product and larger narrow body planes.

Apparently in the investor call, UA said they'd be looking in the used narrow body market for more planes.
International Homo of Mystery
 
ldvaviation
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:37 pm

Quoting STT757 (Thread starter):
PRASM up 3.7%
Quoting RDH3E (Reply 19):
Listening to the earnings call, corporate revenues are up across the board. HVC are coming back to United, not continuing to leave as you suggest.

Not all HVC's are created equal...

At AA, PRASM was up 5.9%.

At Delta, the increase was 5.7%

[Edited 2014-07-24 09:12:11]
 
MaverickM11
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:37 pm

Quoting usairways85 (Reply 25):
Have you sat in the new seats or tried to use the wifi?

The seats aren't any different from DL's 739s or AA's 319s, and I'd take them *any* day over LH/LX's slimline torture devices. People seem to hate the DL and AA seats too, so UA isn't any different here.
E pur si muove -Galileo
 
AeroWesty
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:42 pm

Quoting LDVAviation (Reply 29):
Not all HVC's are created equal...

At AA, PRASM was up 6.5%.

At Delta, the increase was 5.7%

That can be viewed many ways. DL no longer has pressure on fares at ATL as WN exits. UA still has a lot of LCC pressure at its hubs. AA has eliminated a lot of the low close-in fares US used to offer.

There's a lot that goes into PRASM.
International Homo of Mystery
 
MaverickM11
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:47 pm

Quoting AeroWesty (Reply 31):
That can be viewed many ways. DL no longer has pressure on fares at ATL as WN exits. UA still has a lot of LCC pressure at its hubs. AA has eliminated a lot of the low close-in fares US used to offer.

   I'd say DL's PRASM boost is almost entirely due to WN shrinking in ATL and raising fares. US' aggressive pricing structure has also largely gone away.
E pur si muove -Galileo
 
jasoncrh
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:48 pm

I actually flew on a number of LX Europe segments in the past month in those seats. ON totally full flights. I found them rather comfortable.

Quoting MaverickM11 (Reply 30):

Quoting usairways85 (Reply 25):
Have you sat in the new seats or tried to use the wifi?

The seats aren't any different from DL's 739s or AA's 319s, and I'd take them *any* day over LH/LX's slimline torture devices. People seem to hate the DL and AA seats too, so UA isn't any different here.
 
jetblue1965
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:49 pm

Quoting LDVAviation (Reply 29):

Not all HVC's are created equal...

At AA, PRASM was up 6.5%.

At Delta, the increase was 5.7%

And yet UA managed to outperform DL in GAAP net income ex-specials despite DL doing everything right and UA doing "everything wrong" ... goes to show that HVC is not the be-all end-all solution to a network airline.
 
shaq
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:55 pm

I'm very pleased to read good news like this coming from any airline, but United being my favorite, Im very happy.
I'll be sincere, I didnt expected good news like this, but congratulations anyway!

It is good that they are going to see the used market, this year they will have six 757 less and no replacement. It may make a difference if more mainline equipment gets online.

I cant believe that there aviation enthusiast that wish airlines bad. I dont like AA but I'd never wish they go bust!
Studying hard, for flying right!
 
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STT757
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 3:59 pm

Eastern Air lines flt # 701, EWR-MCO Boeing 757
 
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mbm3
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:01 pm

Quoting RDH3E (Reply 19):
Listening to the earnings call, corporate revenues are up across the board. HVC are coming back to United, not continuing to leave as you suggest.

I would be very interested to know how this was determined. If it is based on revenue from corporate contracts, I do not think its indicative of HVC returning to the airline but rather a growing economy spurring companies to have their employees fly more often. While perhaps hard to evaluate and measure, it would be more telling to know which HVC with a choice are in fact choosing UA. From personal experience in my network, very very few as the experience is simply awful.

Quoting bobloblaw (Reply 21):
I think that is a mistake. They should invest in their product

There is most certainly great value in focusing on the stock price, but I do agree that the ongoing passenger experience and employee moral issues need to be rectified immediately. They are retiring 757s and ERJs at an impressive rate, but stumbling on so many other things that is almost comedic in nature....

Quoting FlyPNS1 (Reply 22):
UA's management isn't interested in the long term. The goal is to make lots of cuts to control cost and pump up the stock, so that they can cash out. Notably, Smisek recently bought more UA stock...knowing full well the buyback would help pump up share prices.

It has been obvious that the C Suite and the BoD has been focused on the stock price for some time, operating with "management by spreadsheet" style so they could try to make Wall Street happy with all of their efficiency gained. However, this has obviously alienated customers and employees alike so one has to think the end may be near?
Let Me Tell You, Landing A 772ER Is Harder Than It Looks!
 
ordpark
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:05 pm

Great news for UA! Especially the employees who have been working VERY hard to make this place work....

It seems to be great sport around here to bash UA, and it's getting kinda old....Over all, UA is a pretty good place to work. Are there problems? Of course there are...I'm sure we're not the Workers Paradise that many of you seem to think DL is but we're pretty close....and most of the folks that work here are pretty glad they do.

Anyway, Congratulations UA...keep it going!
 
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drerx7
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:10 pm

What used narrow bodies? 737s I'd assume.
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ldvaviation
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:11 pm

Quoting AeroWesty (Reply 31):
That can be viewed many ways. DL no longer has pressure on fares at ATL as WN exits. UA still has a lot of LCC pressure at its hubs. AA has eliminated a lot of the low close-in fares US used to offer.

There's a lot that goes into PRASM.

Whatever the case, it is what is.

Also of note is that the other two are starting from a higher base and have higher ceilings (yield):

Consolidated (Mainline + Regional)

PRASM

DL 14.99

AA 14.57

UA 14.21

Yield

DL 17.37

AA 17.34

UA 16.66

(Note: I corrected my earlier post. AA's PRASM increased by 5.9% The 6.5% was the increase in yield.)
 
jpetekyxmd80
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:14 pm

Too bad he's built an absolutely abysmal airline in the process.

Former United and Smisek fan.
The Best Care in the Air, 1984-2009
 
AA94
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:14 pm

Quoting ordpark (Reply 38):
It seems to be great sport around here to bash UA, and it's getting kinda old....Over all, UA is a pretty good place to work. Are there problems? Of course there are...I'm sure we're not the Workers Paradise that many of you seem to think DL is but we're pretty close....and most of the folks that work here are pretty glad they do.

I would respectfully disagree. Of course, some of the posters who claim that UA is on the fast track to bankruptcy are talking out their you-know-what, but I think that much of the other dialogue around here centers around UA's lack of consistency and cohesiveness -- the fact still remains that the company still doesn't seem to be operating "as one" yet.

I suppose what I am trying to say is that this quarter, while a good one for UA, doesn't erase the cultural problems that originate from Willis. So yes, good monetary news for UA, but IMHO there is still a ways to go.
 
AeroWesty
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:18 pm

Quoting drerx7 (Reply 39):
What used narrow bodies? 737s I'd assume.

From the notes I read from the call, A320 prices were more attractive to UA at the moment than 738s. But that's not an assurance of anything, just analyst call chatter.
International Homo of Mystery
 
toxtethogrady
Posts: 1860
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:22 pm

Whoever said $800 million after tax just about nailed it.
 
Rdh3e
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:22 pm

Quoting IAHWorldflyer (Reply 27):
as more often than not in my experience, I'm delayed about 45 minutes to an hour.
Quoting mbm3 (Reply 37):
I would be very interested to know how this was determined. If it is based on revenue from corporate contracts, I do not think its indicative of HVC returning to the airline but rather a growing economy spurring companies to have their employees fly more often.

From the call, it sounds like while global accounts revenue is up, the real gains are coming from smaller corporate customers which I believe they said revenue from that segment is up ~27% YoY.
 
toxtethogrady
Posts: 1860
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:24 pm

Quoting STT757 (Reply 11):
UA is also initiating a $1 Billion stock buy back.

Yeah, that's REALLY going to help them grow and compete.   Nothing like giving away money...
 
jayunited
Posts: 2156
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:29 pm

Quoting usairways85 (Reply 25):
Have you sat in the new seats or tried to use the wifi? The new seats aren't investing in their product they are a cost cutting measure to cram more seats onto planes.

I'm sorry but aren't AA, DL and WN all doing the same thing installing more slimline seats on more narrow body aircraft in order to fit more customers on the plane. Are you saying that its okay when other airlines take this path but when UA does it its cost cutting. I didn't know UA was the only airline cramming more seat onto certain aircraft.

Quoting FlyPNS1 (Reply 22):
Notably, Smisek recently bought more UA stock...knowing full well the buyback would help pump up share prices.

This crossed my mind as well we I saw it posted on Flying Together but I didn't give it a second thought till I saw your post. And I have a question wouldn't a move like this be consider illegal if Smisek did in fact buy more stock in UA having full knowledge that a buyback was going to be announced a few weeks after he purchased more shares? Is that illegal or is he allowed to do something like this?

Quoting AeroWesty (Reply 28):
Apparently in the investor call, UA said they'd be looking in the used narrow body market for more planes.

But who has used narrow bodies for sale? If UA is going to be looking at used aircraft I'm sure they are probably looking for some 737NG's or A320/19's because those are the aircraft we already have so who is getting rid of those types of aircraft and are they young enough to be of any use to UA over the long term say 7-10 years?
 
MSPNWA
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:35 pm

Very impressive quarter for UA. They needed a big step in the right direction and got it. Hopefully that will ease the employee's concerns of feeling like that can't compete with AA and DL. This should help morale.
 
max999
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:38 pm

Quoting FlyPNS1 (Reply 22):

UA's management isn't interested in the long term. The goal is to make lots of cuts to control cost and pump up the stock, so that they can cash out. Notably, Smisek recently bought more UA stock...knowing full well the buyback would help pump up share prices.

I agree with you and others on here that the signs point to a company managed for the short term at the expense of a company managed for better long term operations.

For example, operating income in Q2 between UA and DL. The fundamentals of UA (excluding all those one time special items, interest, taxes, etc) are still worse compared to a smaller competitor, especially when you look at the YOY change.

UA Q2
2014 - 2013 - Change %
906 - 770 - 17.7%

DL Q2
2014 - 2013 - Change %
1,579 - 914 - 73%

I think if you're an UA loyal customer, staff, or long term investor...you should be looking deep into the fundamentals and ask how this company is operating (e.g. flying planes on time).

[Edited 2014-07-24 09:45:58]
All the things I really like to do are either immoral, illegal, or fattening.
 
cle757
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RE: UA 2Q Profit $919 Million

Thu Jul 24, 2014 4:41 pm

They didn't make as much as Delta!..more jobs to be outsourced!
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