United Airlines (NASDAQ:UAL) executives said the carrier’s second-quarter 2026 results showed strong demand, improving pricing and continued operational gains, even as a sharp increase in fuel prices pressured earnings and led the company to update its guidance approach.
Chief Executive Officer Scott Kirby said United’s second-quarter revenue rose 16%, which he said recovered “about half the increase in fuel price for the period.” He said the company had been on track to discuss year-over-year earnings growth before fuel prices rose sharply in the prior week.
Revenue Strength Broad-Based Across Network
Chief Commercial Officer Andrew Nocella said total operating revenue rose 16% year over year to $17.7 billion. Passenger revenue per available seat mile, or PRASM, increased 12.1%, while load factors were up slightly, which he said indicated strong demand for United’s products.
Domestic passenger revenue rose 20.3%, with domestic PRASM up 12.2%. International PRASM rose 12%, including a 14% increase in the Pacific region, 12.1% in the Atlantic and 10.7% in Latin America. Cargo revenue increased 22.6%, with Nocella saying most of the gains were yield-related rather than volume-related.
Loyalty revenue rose 11.3%. Nocella said MileagePlus program changes helped drive momentum in co-branded credit card accounts, spending, engagement and membership. New co-branded credit card accounts reached a second-quarter record, up 22%, while card spend rose 14% and MileagePlus enrollments increased 9%.
Premium revenue increased 16.4%, and premium PRASM rose 11.6%. PRASM for the Polaris and Premium Plus cabins rose 13.6%, while main cabin PRASM increased 11.5%.
Nocella said close-in business travel was “exceptionally strong,” with contracted business revenues flown up 27% and bookings up 30%, led by technology, financial services and professional services. United grew corporate share year over year in all of its hubs, he said.
Guidance Reflects Higher Fuel Costs
Chief Financial Officer Mike Leskinen said United delivered second-quarter earnings per share of $1.99, at the high end of its guidance range of $1 to $2. The company reported a 4.8% pre-tax margin despite a $2.3 billion year-over-year fuel headwind.
United expects third-quarter earnings per share of $2.50 to $3.50, based on an all-in fuel price of about $3.69 using Tuesday’s curve. For the full year, the company tightened guidance to $9 to $11 per share, at the high end of its prior range.
Leskinen said fuel prices had increased 15% to 20% since early July, and that fuel remained almost $6 billion higher for the year compared with United’s outlook at the start of the year. He said the company expects to recover 80% to 90% of the fuel increase in the third quarter and fully recover it by the fourth quarter.
Executives repeatedly said they had not seen measurable demand weakness from higher fares. Kirby argued that industry pricing is being driven not only by fuel but by structural increases in non-fuel costs, including airport fees, labor and maintenance.
Operations Improve as Starlink Rollout Accelerates
President Brett Hart said United carried 10 of the highest passenger days in company history during the quarter, including more than 640,000 customers on June 18. He said the airline had top-tier on-time departures for the sixth consecutive quarter among its largest U.S. competitors and recorded its lowest second-quarter seat cancellation rate in company history.
Hart highlighted improvements at Newark, United’s busiest global gateway. In June, Newark ranked first in on-time arrivals, posted its best on-time departure rate ever and recorded its lowest seat cancellation rate since 2018, he said.
Customer satisfaction also improved, with Hart saying United recorded its highest second-quarter Net Promoter Score since the pandemic.
United is also accelerating its rollout of free Starlink Wi-Fi. Hart said the company now expects to have close to 1,000 Starlink-equipped aircraft by the end of the year. Wi-Fi satisfaction scores on Starlink-equipped aircraft are more than double those of other Wi-Fi aircraft, he said.
Fleet and Product Investments Remain Central to Strategy
Executives said United’s strategy remains focused on brand loyalty, product differentiation and premium growth. Kirby said the airline is using the current environment to accelerate investments in the customer experience “from nose to tail.”
Nocella said United continues to gain local share in each of its seven hubs and that passenger share in those hubs has increased seven points since 2019. He said United’s efforts to decommoditize revenue streams and create more consumer choice are accelerating heading into 2027.
The company said it has renewed optimism that it will take delivery of its first Boeing MAX 10 in mid- to late 2027. Nocella said the MAX 10 will have more premium seats than the aircraft it replaces and “best-in-class CASM.” United also plans to expand flying on premium Airbus A321 aircraft, including the XLR and Coastliner, later this year and into 2027.
Leskinen said United plans to retire at least 80 aircraft in 2027 as it renews and upgauges its fleet. He said those retirements will help improve cost performance because the aircraft being retired are older, less fuel efficient and have older cabins.
Balance Sheet Liquidity Raised Amid Oil Volatility
Leskinen said United raised $3.7 billion of new debt through private bank transactions after heightened volatility related to hostilities with Iran and risks around the Strait of Hormuz. He said the debt was priced at a fixed-rate equivalent in the low 5% range, inside the company’s most expensive existing debt.
Once oil prices stabilize, United intends to use the funds to prepay more expensive debt and purchase aircraft with cash, Leskinen said. Since the beginning of the second quarter, the company has prepaid about $1 billion of higher-cost legacy aircraft debt and PSP debt.
United ended the quarter with $19.6 billion of available liquidity. Leskinen said the company remains focused on achieving investment-grade credit metrics and is optimistic about its prospects later this year.
About United Airlines (NASDAQ:UAL)
United Airlines Holdings, Inc operates United Airlines, a major U.S. full-service passenger carrier providing scheduled air transportation for passengers and cargo. The company offers a comprehensive route network that covers domestic markets across the United States as well as extensive international service to Europe, Asia, Latin America, and the Pacific. United operates a mixed fleet of narrow- and wide-body aircraft on point-to-point and hub-and-spoke routes, and supports corporate and leisure travel through offerings such as premium cabins, basic economy, and ancillary services including baggage, seat selection and in-flight amenities.
In addition to passenger operations, United provides cargo services through United Cargo, handling freight, mail and specialized shipments.
