JetBlue Airlines (NYSE: JBLU) is one of the United States’ largest air carriers. The company is the sixth-largest airline behind American Airlines, United Airlines, Delta Airlines, Southwest Airlines, and Alaskan Airlines. In 2019, JetBlue had a 5.5% market share in domestic air travel. In 2020 however, the airline has been another victim of the coronavirus pandemic that pushed travel demand to nearly zero and put airlines under existential threat. In order to prevent the collapse of the entire aviation industry, the government has $25 billion in support to cover salaries and other operating costs. Of this stimulus package, JetBlue has received $936 million and borrowed another $1 billion in March.(Forbes)
The airline has decided to cut capacity by 95% in Q2 due to virtually non-existent demand and also reduce available seating for social distancing reasons. This week the airline also announced a 30% reduction in their Airbus A321 orders, down to 40 from 61, in order to save an extra $1.1 billion.(Reuters)
The company reported it’s quarterly numbers yesterday aftermarket and sent a shiver down investors’ spine as they were significantly worse than analyst predictions. The company reported a loss of -$0.42 per share against predictions of -$0.37 per share, and revenues of $1.59 billion against predictions of $1.69 billion.(Motley Fool)
The earnings call was not all bad news though as management reported a significant reduction in cash burn. The company reported that it expects cash burn in May to be under $10 million after burning cash at $18 million a day in March and expect to further lower to between $7-$9 million a day after optimizations. Management also stressed that this does not include the help it received from the government, after which cash burn can be just $2-$5 million a day.(MarketWatch)
The company ended the quarter with $3.1 billion liquidity on its books and is currently trading 57% down YTD at a P/E of 4.29.