United Airlines cuts capacity, sees lower revenue
The airline to slash flights by 50% for April and May amid coronavirus
Stocks impacted: United Airlines Holdings Inc. (UAL)
Citing the expected drop in demand due to the coronavirus outbreak, United Airlines announced a cut in its capacity by about 50% for April and May. Even with the cut in capacity, load factors are expected to drop into the 20% to 30% range, "and that's if things don't get worse." The company also said it would cut corporate officers' salaries by 50%. United Airlines currently projects that revenue in March will be $1.5 billion lower than a year ago. United carried one million fewer passengers in the first two weeks of March compared with a year ago. Of note, S&P revises its credit outlook on the company to negative from positive. On Friday, United stocks rallied by over 12% amid a general recovery in risk sentiment. Today, the company’s shares will likely reverse the recent gains on the news.
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