United Airlines Holdings, Inc.
UAL · Nasdaq
Next quarter
Reports Oct 21, 2026.
Consensus is $3.01 EPS for Sep 2026 across 8 estimates, ranging $2.65 to $3.54.
UAL Jun 2026
- 3.65%
- -1.79%
- $1.92
- $1.99
- —
- $17.67B
Reported results
- $17.67B
- $1.10B
- 6.20%
- $805.00M
- $2.46
Highlights
- Adjusted earnings beat: Q2 adjusted diluted EPS was $1.99 versus consensus of $1.92, a 3.65% surprise, while GAAP diluted EPS was $2.46.
- Revenue growth: Operating revenue rose 16.0% year over year to $17.67 billion, up from $15.24 billion in Q2 2025 and $14.61 billion in Q1 2026.
- Fuel shock absorbed: Aircraft fuel expense increased 84.1% year over year to $5.11 billion, but United recovered approximately half of the $2.3 billion increase through fares and fees.
- Guidance raised: Full-year 2026 adjusted diluted EPS guidance increased to $9.00-$11.00 despite nearly $6 billion of anticipated incremental fuel expense versus the start-of-year assumption.
- Unit revenue outpaced capacity: TRASM increased 12.1% and yield rose 12.1% with capacity up 3.5%; passenger revenue increased 16.4% to $16.10 billion.
- Profitability declined year over year: GAAP operating income fell 17.3% to $1.10 billion and net income fell 17.3% to $805 million; adjusted pre-tax margin was 4.8%, down from 11.0% a year earlier.
- Broad-based revenue contribution: Premium revenue rose 16%, Basic Economy 11%, loyalty revenue 11% and cargo revenue 23%; contracted business revenue increased 27%.
- Starlink rollout accelerated: Starlink was installed on 450 aircraft, with nearly 1,000 expected by year-end; customer satisfaction for Wi-Fi-equipped flights was more than twice that of other Wi-Fi-operating aircraft.
- Liquidity and leverage: United ended the quarter with $19.6 billion of available liquidity, $26.5 billion of debt and other financial liabilities, and 2.2x trailing-twelve-month net leverage after raising $3.7 billion of liquidity and prepaying approximately $1 billion of higher-cost debt.
Analysis
United’s second quarter was a demand and pricing success constrained by an extraordinary fuel-cost increase. Adjusted diluted EPS of $1.99 exceeded the $1.92 consensus estimate, but was 48.6% below the $3.87 reported in Q2 2025; GAAP EPS was $2.46 versus $2.97 a year ago. Revenue reached $17.67 billion, up 16.0% year over year and 21.0% sequentially from $14.61 billion in Q1, while operating income increased 9.9% from $997 million in the prior quarter but declined 17.3% from $1.32 billion a year earlier.
The defining feature was United’s ability to push through higher fares and monetize a stronger product while fuel expense rose $2.3 billion, or 84.1%, to $5.11 billion. TRASM and yield each rose about 12%, well ahead of 3.5% capacity growth, and passenger revenue increased 16.4%. That revenue performance was offset by fuel and other operating cost inflation, with CASM-ex up 6.1%. Management nevertheless raised full-year adjusted EPS guidance to $9.00-$11.00, expects to recover 80%-90% of the incremental fuel cost in Q3 and all of it by Q4, and continued investing in Starlink, aircraft and customer experience. The balance sheet also strengthened operationally through $19.6 billion of liquidity and a stated path toward investment grade.
Demand and pricing
- Passenger revenue: Passenger revenue increased 16.4% year over year to $16.10 billion, driven by a 12.1% increase in yield and 5.4% more passengers.
- Unit revenue: PRASM rose 12.5% to 18.45 cents and TRASM rose 12.1% to 20.25 cents, while available seat miles increased 3.5% and the consolidated load factor improved 0.3 points to 83.4%.
- Revenue mix: Premium revenue grew 16%, Basic Economy 11%, loyalty revenue 11% and cargo revenue 23%; contracted business revenue increased 27%, and economy unit revenue rose 12% for a second consecutive quarter.
- Geography: Domestic passenger revenue increased 20.3%, Pacific revenue 18.7%, Latin America 10.5% and Atlantic revenue 7.9%; Middle East, India and Africa revenue declined 16.4% amid geopolitical disruption.
Fuel and margins
United converted strong demand into higher fares, but the fuel shock absorbed most of the revenue benefit. Aircraft fuel expense rose $2.335 billion, or 84.1%, to $5.110 billion, with the average fuel price increasing to $4.19 per gallon from $2.34. Total operating expenses rose 19.2% to $16.58 billion, faster than revenue, reducing operating income to $1.10 billion from $1.32 billion and operating margin to 6.2% from 8.7%.
- Underlying costs: CASM-ex increased 6.1% to 13.12 cents, excluding fuel, profit sharing, special charges and third-party business expenses. Salaries rose 6.2% to $4.69 billion, while distribution expense increased 32.3% to $644 million.
- Fuel recovery: United recovered approximately half of the Q2 fuel increase, expects to recover 80%-90% in Q3 and 100% by Q4. Management estimates full-year 2026 fuel expense will be nearly $6 billion above its initial assumption.
- Adjusted result: Adjusted pre-tax earnings were $843 million, with a 4.8% adjusted pre-tax margin versus 11.0% in Q2 2025. Adjusted net income was $649 million versus $1.27 billion a year earlier.
Raised full-year outlook
Despite the fuel burden, United raised its full-year 2026 adjusted diluted EPS outlook to $9.00-$11.00. The second-quarter adjusted EPS result was near the top end of the company’s prior guidance and the company cited strong yields, resilient close-in demand and the ability to adjust schedules and fares after oil prices spiked in March. The outlook depends heavily on continued pricing power and the expected timing of fuel-cost recovery.
Product and operations
- Starlink: Starlink was installed on 450 United mainline and United Express aircraft, including the first widebody aircraft, with nearly 1,000 installations expected by year-end and full-fleet coverage targeted by the end of 2027.
- Customer experience: United recorded its best second-quarter customer satisfaction score since 2021 and its second-best score ever. Digital check-in reached 87.7%, while 48.7% of customers bypassed the lobby.
- Reliability: The systemwide second-quarter on-time departure rate was the best since 2021, the seat-cancellation rate was the lowest in company history excluding the pandemic years, and Newark posted its best-ever second-quarter on-time performance.
- Network and fleet: United launched 27 new U.S. and Canada routes, took delivery of its first A321XLR, and ended the quarter with 1,552 aircraft, up 5.4% from a year earlier.
Liquidity and deleveraging
United prioritized resilience and balance-sheet flexibility amid fuel and geopolitical uncertainty. It raised $3.7 billion of new liquidity through private bank transactions during the quarter and prepaid approximately $1 billion of higher-cost debt. Available liquidity ended at $19.6 billion, including $10.17 billion of cash and $6.47 billion of short-term investments, while operating cash flow was $1.61 billion and free cash flow was $322 million.
- Capital structure: Debt, finance lease obligations and other financial liabilities totaled $26.5 billion at quarter-end; adjusted net debt was $18.1 billion and trailing-twelve-month net leverage was 2.2x versus 2.0x a year earlier.
- Investment-grade target: Management continues to target an investment-grade rating in 2026. Existing ratings were BB+ from S&P and Fitch and Ba1 from Moody’s.
- Capital allocation: First-half capital expenditures were $3.02 billion, while share repurchases totaled only $27 million, or 0.3 million shares, as the company emphasized liquidity and debt reduction.
