American Airlines remained on track to fully restore its revenue share from indirect channels as 2024 ended, according to Robert Isom, CEO, speaking on a fourth quarter earnings call. He said. “I feel really good about the progress we’ve made in a short six-month period.”
Isom said that an 8% year-over-year increase in the fourth quarter in business travel revenue represented “a sequential improvement of two points versus last quarter, and we continue to see yield strength as we look ahead into the new year. … As we take a look at forward bookings, it really suggests that we’ve got traction in the marketplace.”
The carrier’s share of corporate business dropped when it pursued direct and NDC bookings. That strategy, which alienated travel agencies and their customers, ended last May.
Steve Johnson, chief strategy officer, said that American’s share of the corporate segment may even recover sooner than the end of this year, but he added that “it’s not a linear process.“ He said that American’s abandonment of its prior strategy along with the restoration of fare content into the legacy GDSs and Isom’s engagement with American’s partners in the third quarter had an impact on share.
During the fourth quarter, said Johnson, American focused on negotiating new deals with corporate travel agencies “While it was going on,” he said, “understandably, we were negotiating, so you didn’t see a lot of share shift during that period of time. But it was ultimately successful, and we now have new agreements with 30 of the most important agencies.”
Isom said the carrier also reviewed and reworked agreements with its corporate customers most affected by the previous strategy and “largely restored share of those travelers in our hub markets.”. He added, “I spent a considerable amount of my time making sure that I was up to speed and talking to our corporate customers and agencies, as well. That work is paying off.”
American reported fourth-quarter passenger revenue of $12.4 billion, up 3.3% year over year. Net income in the fourth quarter was $590 million, , up from the $19 million a year earlier.
