United loses $1.36 billion as business travel remains weak

United Airlines posted a $1.36 billion loss in the first quarter and will need a rebound in lucrative business and international travel before it returns to profitability.

The loss reported Monday would have been even wider without federal payroll aid, but it was still slightly worse than expected. However, investors are far more interested in how quickly United and other airlines can recover from their pandemic-caused financial crisis.

United executives have said recently that bookings are rising ahead of the peak summer vacation season, and they expect that trend to grow stronger as more Americans get vaccinated against COVID-19. The airline predicted that a number of financial measures will improve from the first quarter into the second.

Still, United and rivals American Airlines and Delta Air Lines depend on high-fare business and international travelers for an outsized share of revenue, and nobody knows exactly when those customers will come back.

United announced separately on Monday that it plans to operate new flights to Greece, Croatia and Iceland in July. The airline is betting that travel restrictions will ease, allowing vaccinated vacationers to visit more places.

United executives declined to comment until talking to analysts on Tuesday. CEO Scott Kirby said in a statement that executives “now see a clear path to profitability. We’re encouraged by the strong evidence of pent-up demand for air travel" and can match it to meet targets for a financial recovery.

The airline said in a news release that it turned cash-flow positive in March, excluding certain costs. United expects positive earnings before interest, taxes and certain other expenses later this year, assuming that business and international travel return to 30% of their pre-pandemic levels.

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