Surging U.S. cases of the Covid-19 delta variant have not taken a toll on United Airlines, according to CEO Scott Kirby.
"We haven't seen an impact at all on bookings, which continue to get stronger and stronger every week," Kirby said during United's Q2 earnings call on Wednesday.
The seven-day Covid-19 case average in the U.S. is more than 26,000, according to the CDC, a 69% increase from a week ago. The seven-day average of 211 deaths is up from 167 a week ago.
We don't just see light at the end of the tunnel, we're exiting the tunnel.
CDC director Rochelle Walensky testified at a Senate hearing Tuesday that the delta variant is now estimated to comprise 83% of U.S. Covid-19 cases.
Possibly due to concern among investors that the delta variant could negatively impact travel demand, United's stock price fell approximately 15% during the seven days between July 9 and July 16, before a partial rebound this week that has continued on Wednesday.
Rising Covid-19 cases notwithstanding, Kirby said the most likely outcome for United is that demand recovery will continue unabated, especially as more borders, including U.S. borders, reopen. Also, United expects business travel, which is currently down approximately 60% compared to 2019, to be close to 50% of 2019 levels by September.
With its order of 270 single-aisle, mainline aircraft for delivery by 2026, United plans to increase its premium product offerings for domestic travel.
The United CEO said that a recent company survey found that 84% of MileagePlus loyalty members are fully vaccinated against Covid-19.
Kirby acknowledged that there is a possibility that renewed government regulations of some sort could stall recovery, but he said that even if that were to happen, such measures would likely be short-lived.
"We don't just see light at the end of the tunnel, we're exiting the tunnel," Kirby said.
His remarks came as United reported a net loss of $434 million during the second quarter, a figure that increases to $1.3 billion when adjusted to remove the federal payroll support United received, along with other smaller items.
The carrier reported revenue during the June quarter of $5.47 billion, beating analyst expectations by $140 million. The figure dwarfed United's first-quarter revenue of $3.22 billion, a reflection of the surge in travel as the Covid-19 pandemic has lightened its grip in the U.S. Still, it was less than half of the $11.4 billion United hauled in during the second quarter of 2019.
Operating expenses were $5.74 billion during Q2 compared to $9.93 billion in Q2 of 2019.
Capacity flown was just 54% of the 2019 level. The carrier said it expects to fly 74% of its 2019 capacity in the third quarter.