American Airlines Group Inc. AAL, -1.75% said Thursday it still expects second-quarter system capacity, as measured per total available seat miles, to be down 20% to 25%, and for revenue to be down about 40% compared with the second quarter of 2019, the year before the pandemic decimated travel. The airline said it has seen continued strength in net bookings and load factors, however. As of June 2, the seven-day moving average of net booking was about 90% of where it was in the same period in 2019, while the domestic load factor for May was about 84% and greater than 88% over the Memorial Day weekend. “The company presently expects this strength in bookings to continue through the end of the second quarter and into the third quarter and, assuming continuation of current trends, expects leisure yields to approach or exceed the corresponding 2019 levels during the peak summer travel period,” American said in a regulatory filing. “Although business demand continues to be weak, the company is starting to see increased demand among small and medium sized enterprises and certain large corporate customers.” The company generated cash in May for the first time since the start of the outbreak and expects to end the second quarter with liquidity of more than $20 billion, compared with prior guidance of $19.5 billion. The airline will focus on debt reductions and optimizing its balance sheet, including through the use of cash on hand or the potential issuance of about $800 million of common stock through an ATM (at the market) program. Shares were down 1.5% premarket but have gained 64% in the year to date, while the U.S. Global JETS ETF JETS, -2.16% has gained 22% and the S&P 500 SPX, -0.56% has gained 12%.
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