JetBlue Airways reports a 90% decline in revenue in Q2

JetBlue Airways (NASDAQ: JBLU) revealed to have concluded its fiscal second quarter in loss on Tuesday due to COVID-19 restrictions. The company also warned that an 80% decline in its revenue in the third quarter was likely as the Coronavirus pandemic continues to wreak havoc on demand for air travel. JetBlue had seen a 15% decline in revenue in the first quarter.

Shares of the company opened about 2% down on Tuesday but jumped roughly 2.5% later in the day. At £8.04 per share, JetBlue Airways is currently 45% down year to date in the stock market after recovering from an even lower £5.30 per share in March when the impact of COVID-19 was at its peak. Learn more about how do people make money on the stock market.

JetBlue records a 94% decline in passenger traffic

The U.S. air carrier said that passenger traffic dropped by an unprecedented 94% to 616K in its recent quarter. In the same quarter last year, it had carried a total of 11 million passengers. In terms of revenue, the company recorded a 90% decline from over £1.62 billion in Q2 of 2019 to only £166 million in the quarter that ended on 30^th June.

Originally, experts forecast that demand bottomed out earlier this year in spring. Owing to the surge in COVID-19 cases in recent weeks that pushed several states including New York into imposing new travel restrictions, however, the prospect of a timely recovery now looks grim. JetBlue announced its strategic partnership with American Airlines last week.

Similar to its competitors, JetBlue is committed to minimising costs to combat the impact of COVID-19. In its financial report on Tuesday, the airline also highlighted that on a year over year basis, its capacity will remain at least 45% down in the fiscal third quarter.

JetBlue burned through £7.34 million per day in Q2

In the second quarter, as per JetBlue, it burned through £7.34 million per day. For the third quarter, it now forecasts its average daily cash burn to fall in the range of £5.41 million to £6.95 million. At £247.25 million, the air carrier said that its net loss in the second quarter came in significantly weaker than £138.31 million of net income in the comparable quarter of last year.

JetBlue performed fairly upbeat in the stock market last year with an annual gain of more than 15%. At the time of writing, the American low-cost airline has a market cap of £2.17 billion and a price to earnings ratio of 12.74.