10:35 AM EST, 01/23/2025 (MT Newswires) -- American Airlines ( AAL ) reported fourth-quarter results that exceeded market expectations, but the company projected a larger-than-expected loss for the current quarter, sending its shares sharply lower in Thursday trading.

The air carrier expects an adjusted loss of $0.20 to $0.40 a share for the first quarter, while the current consensus on FactSet is for a per-share loss of $0.04. Total revenue is pegged to grow between 3% and 5% versus the prior-year quarter, while capacity is forecast to be down 2% to flat, according to an investor update.

"Capacity is driven by lower capacity in the off-peak months of January and February, which combined are down approximately 3%, followed by growth of 3% to 4% in the peak travel period in March," Chief Financial Officer Devon May said during a conference call, according to a FactSet transcript. "We will remain flexible and will adjust capacity in response to demand and the competitive environment in which we operate."

Shares of the company dropped 9.6% in Thursday trade.

In the December quarter, American Airlines' ( AAL ) adjusted EPS climbed to $0.86 from $0.29 last year, surpassing the Street's view for $0.66. Operating revenue improved 4.6% year over year to $13.66 billion, above the average analyst estimate of $13.43 billion, buoyed by the airline's actions to adjust capacity and continuous robust travel demand, it said.

"We continue to run a reliable operation, and we are reengineering the business to build an even more efficient airline," Chief Executive Robert Isom said in a statement. "That, coupled with our commercial actions, resulted in strong financial performance in the fourth quarter."

Domestic passenger revenue inclined 3.5% year over year to $9.05 billion while international passenger revenue rose 2.6% to $3.35 billion. Cargo revenue increased about 11%. Total revenue per available seat miles, which is commonly used in the airline industry to measure efficiency, gained 2% on capacity growth of 2.5%.

Total operating expenses ticked up to $12.53 billion from $12.41 billion in the 2023 quarter. Cost per available seat mile, excluding net special items and fuel, inclined 5.7%.

For the full year 2025, the airline expects adjusted EPS of $1.70 to $2.70, compared with the $1.96 it recorded in the previous year. The Street is looking for non-GAAP EPS of $2.42. Total revenue is projected to rise by 4.5% to 7.5%, compared with the 2.7% annual growth logged in 2024.

"We continue to expect full-year capacity to be up low-single-digits, in line with expected economic growth and our prior guidance," May said on the call.

Price: 16.99, Change: -1.68, Percent Change: -8.98