Sentiment Analysis of the earnings transcript to help figure out if there are any bullish or bearish sentiments that could be gathered from it. We're doing ML and AI based analysis on the earnings call to get some more insights.
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| And so we get to the quarter and we have EPS that's like pretty solid, we should be pretty proud of |
| It was price and schedule, price and schedule, pricing and schedule and that's where the airline -- the highest margins operated |
| And we've got actually a pretty good track record since we've been giving EPS guidance of hitting it |
| We have an incredible high-margin, asset-light growth business within United Airlines |
| But we're starting to see that come back on without a doubt, the margins in the Pacific are strong right now and we're going to continue to layer in growth |
| And I think we'll ultimately lead to strong free cash flow profile for United and some of the major carriers |
| It's tremendous what is done to create this inversion in margins where ours are now very strong relative to the low-cost carriers |
| As we look into the future, I think that there are -- I think that the aspirations for capacity adds are not going to be fully met and we expect Atlantic margins to remain quite strong |
| We at United have a unique opportunity to drive additional gauge |
| And so we have this convergence of opportunity to reallocate some of that capital but this is in no way shape or form backing away from our in-state goal of what our connectivity, what the number of flights, what the bank structure is in our hubs where we have a true and permanent competitive advantage |
| And I'm excited about that in the seat of CFO to make some improvements in the procurement department, in particular but also tech ops |
| And I'm really proud of what Aviate Academy is doing because in addition to helping secure the best and brightest pilots, we've added quite a bit of diversity into that recruitment path which I think is a unique United attributes |
| We're going to grow through great product with premium options for our customers |
| And justifiably, it's the highest NPV career you can have as a pilot is to come fly at United, where you can -- you are top of scale at the beginning when you're flying narrowbodies but you can move up to widebodies and have quite an amazing career |
| You guys had very good premium cabin growth in the latest quarter |
| I think we've got some opportunity to do better things there, with a part or working with additional [indiscernible] and so I'm excited about that |
| And we benefited from that financially |
| And so what I've seen being inside of United is that, we have more ability than we're giving credit for to deliver on EPS |
| They had big labor cost advantage |
| Our margins on a relative basis have expanded dramatically and the margins of some of our competitors have contracted significantly |
| And that really was the biggest advantage |
| Mike Leskinen Well, United has long had the strongest franchise in the Transpacific |
| But basic economy also did very well |
| Really great to have you |
| What I will say is that at United and our major competitor in Atlanta, we're taking a very differentiated approach in decommoditizing this business and giving customers choice |
| So at the same time, we break out with the revenue advantage through decommoditizing our product that long-term structural advantage formerly structural advantage around cost has gone away |
| And right now, those businesses are deeply, deeply undervalued |
| And I think the MileagePlus view is intriguing |
| And we are absolutely delighted to have United Airlines with us this morning, CFO, Mike Leskinen |
| And the reason for that is that the scarcity of inputs has caused a cost convergence that has really accelerated the structural improvement in this industry |
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| And so I think while we're deeply disappointed in Boeing, for the delays around our aircraft deliveries |
| But right now, with the negative margins at some of these low-cost carriers, I think some call them LMAs now; the neighborhood doesn't look very pretty and so that's holding us down |
| Number two, airline industry is probably the hardest industry to decarbonize that exists |
| If we give a bunch of guidance, you don't believe it, it's actually worse than not having guidance |
| Unidentified Analyst There seems to be a fear that Atlantic is over earning last summer this year, too much capacity from non-U.S |
| Some of our regional partners have had some pilot issues for sure |
| I think inflation has surprised the entire economy |
| And the reverse can be true as well, where we end up missing on a TRASM but fuel fell through the bottom and so all sequel that put a little pressure on TRASM |
| But there's a recognition that spending more than operating cash flow year after year after year is depressing our multiple |
| In fact, it's more than flipped right now because most of them are actually losing money right now |
| It seems a little bit frustrating that, that's okay but it is not okay for us to do the same |
| And so what I've seen the airline industry do -- airline after airline is set numbers only to miss them; it's almost like a bad joke |
| And that's something as well with -- from my perspective, the share is being unreasonably low from a PE valuation perspective |
| I know this has been an issue in recent years |
| And no matter what point you're going to come off that drug, it hurts, you can go through a hangover |
| There will be scenarios where there's a 2 standard deviation event or as I like to say, like 2x of God in the quarter versus -- we'll prepare the guidance for like 1 active god that negatively impacts us but not two |
| And so we're over-earning and some are under-earning |
| It's not -- it's a scary prospect |
| And while it has moderated, there still is a scarcity of pilots |
| And when we think about costs, just to kind of build on that idea a little bit, across the industry, there has been pressure on the labor cost, maintenance cost, how are you seeing this in 2024? And is it conceivable that 2025, we could see a clean year from the cost perspective |
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