Why Recessions Forge Great CEOs Who Think Beyond Cost-Cutting
04/15/2025
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But the CEOs who make history in downturns aren’t the ones with the deepest cuts
April 23, 2021: -On Thursday, American Airlines posted its fifth consecutive quarterly loss while Southwest Airlines move towards a profit, boosted by federal payroll aid.
Both the carriers saw an improvement in travel bookings. They plan to increase flying during the peak spring and summer months as more people are vaccinated against Covid-19 and tourist attractions reopen.
Americans said it is planning to operate second-quarter capacity that’s 20% to 25% less than the same quarter of 2019, while Southwest said it would fly only slightly lower this June than 2019 and 15% lower in the second quarter over 2019.
American Airlines posted a $1.25 billion net loss. Like its large-carrier rivals Delta and United, the Fort Worth, Texas-based carrier has been forced to do without the business, and international travel revenue airlines have long relied on. American CEO Doug Parker said business travel demand is beginning to improve but is still far away from pre-pandemic time.
American’s first-quarter revenue came in above $4 billion, down around 53% from above $8.5 billion it posted a year earlier and below the expectations of the analysts. Adjusting for one-time items, Americans had a per-share loss of $4.32, a penny over the estimation of the analysts.
“The pandemic is far from over. We have to continue to fight like never before and ensure that when the green flag drops, American is out in front,” Parker and President Robert Isom said in a note to employees. “But as our world makes daily strides in COVID-19 vaccination efforts, customers return to travel, and undoubtedly the pace of the recovery is accelerating.”
The Dallas-based airline posted a first-quarter net income of $116 million, compared with a $94 million loss a year earlier. Its first-quarter profit resulted from more than $1 billion in federal aid that offset its labor costs.
But the CEOs who make history in downturns aren’t the ones with the deepest cuts
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