United Airlines announced healthy revenue and profits today, beating Wall Street estimates, but also announced it would initiate its first stock buybacks since before the pandemic, infuriating Sara Nelson and the union representing flight attendants.
United Airlines Beats Wall Street Expectations, Announces Stock Buybacks
It was a profitable 2024 third quarter for United, with revenue and profit that beat analyst expectations:
- Earnings per share: $3.33 adjusted vs. $3.17 forecast
- Revenue: $14.84 billion vs. $14.78 billion forecast
- Net income: $965 million (down 15% from a year ago)
Fares are also set to rise as budget carriers retreat. Chief Commercial Officer Andrew Nocella explained:
“We believe Q1 yield strength will be possible due to the significant schedule changes and business model changes that will continue to be implemented by low-margin airlines.”
Chief Executive Officer Scott Kirby emphasized that United has invested $32 billion in employees, customers, infrastructure, and technology since 2021. In an investor call and a letter to employees explaining its Q3 results, Kirby recounted how United has invested in its employees and infrastructure over the last four years.
“I’m proud of our creativity as we really try to do things that change the airline experience – from ConnectionSaver, Agent on Demand, the best app (by far) of any airline in the world, Starlink, eliminating delay codes to empower employees to do the right thing for customers, customer communication tools, Kinective Media, and the sexiest set of new international destinations in aviation history, just to name a few.”
He then recites United’s top three priorities, which he ranks as:
- Investing in the business
- Paying down high-cost debt to strengthen the balance sheet
- Shareholder returns
Per Kirby:
“We know that customer service and customer experience are a big reason why customers are choosing us and why we’re winning share everywhere we fly. And at United, our number 1 priority remains to invest in the business – including our people. Our second priority is to pay down high-cost debt and strengthen the balance sheet. And only after we’ve done those two things, our third priority is shareholder returns.”
All this leads to the announcement of a new share repurchase program.
“Like other leading airlines and companies, we are initiating a measured, strategic share repurchase program…Importantly, my commitment to you is that investing in our people and our business will always be my top priority even while we institute this share repurchase program.”
That includes buying back $1.5 billion worth of shares, the first such action since before the COVID-19 pandemic.
Shares of United are heading for their highest close today since February 2020.
Sara Nelson, Flight Attendants Union Outraged By Stock Buybacks
Sara Nelson, the President of the AFA-CWA union representing United flight attendants and often called the “world’s most powerful flight attendant,” quickly condemned the news of the stock buybacks.
HUGE Mistake @united! https://t.co/bacugMwr0I pic.twitter.com/OeAQVLLVa1
— Sara Nelson (@FlyingWithSara) October 15, 2024
“Stock buybacks are a sickness that hurts workers and consumers alike. The airline industry was rid of them, but a greedhead hedge fund broke the seal in its efforts to gain control of Southwest Airlines and now United Airlines management is following their lead to manipulate the stock and cheat workers and passengers…
“That money United just promised Wall Street belongs to Flight Attendants who worked throughout the pandemic and during this taxing recovery for all of us on the frontlines. United management could end the games and agree to the contract Flight Attendants have earned tomorrow. But instead, they are choosing to jump back in the greed pool with this century’s robber barons.
“Make no mistake, United Airlines Flight Attendants are ready to do whatever it takes to get the contract we deserve. “We will take this message directly to executives at United Airlines Headquarters at Willis Tower on Thursday. It’s time for United to pay us or face CHAOS!”
CHAOS is AFA’s trademarked strategy of intermittent strikes and other non-traditional work actions. Questioning stock buybacks is fair, but reducing them to pure greed is foolish.
My question, as a customer, is whether this news (both the increased profits and the stock buybacks) will noticeably decrease flight attendance morale until a new deal is reached.
In any case, we will soon see…
that little b***h
she really needs to stay in her lane
The old adage of “children should be seen and not heard” applies to Sarah Nelson
Luckily she isn’t a child then and has a job that literally asks her to be seen and speak on behalf of flight attendants. They literally pay her dues to do this on their behalf.
Many people call us FA’s coke machines and other derogatory names, completely dismissing the vital safety role we fill in this industry. Our careers are filled with many sacrifices and long hours, and are deserving of a contract that reflects this.
Kirby initiating a buyback when the face of the company (FA’s) are still waiting for fair compensation is insulting.
Trey, I totally understand that sentiment. It is high time for a new contract and the healthy profits and revenue make the case for a better FA contract. I wish you all the best in achieving that soon.
Maybe if you actually performed a safety role instead of pretending to? Or actually performed the other job you are sworn to, providing kind and appropriate service to customers, people would be more on your side. In the meantime you are going to have a hard time getting any sympathy from flyers who, in reality, would love to see you all leave and open the door for employees that care about the customer experience.
United flight attendants deserve a raise they are now the lowest paid flight attendants at all pay grades when looking at AA, DL, and WN. For Kirby to do this stock buyback when they still haven’t compensated their FA’s for all the hard work they’ve done during and post pandemic is shameful. I’m no fan of Sarah Nelson but I do believe United needs to properly compensate their flight attendants.
A lot of hyperbole from Nelson. I truly dislike the woman but United is screwing over the people that are the primary face of the company to passengers by not giving the FA’s a decent contract. Kirby is talking out of both sides of his mouth when the first priority he lists is investing in the company but hoses the flight attendants at the same time. I have a very, very low opinion of Kirby but at least he could be silent instead of going out of his way to anger the faces of his “Best Airline In The World”.
But the problem is that United has actually done more than offer the FA’s a ‘decent contract’, in fact they’ve offered them a contract that’s nearly identical to the recently ratified DL and AA contracts (plus a dollar of course), but even though thats industry leading, its not industry leading enough apparently. They want more…more, more, more. What would be amazing is if FA’s went out and actually did an incredible job to justify their demands rather than snatching trays away and grazing crotches.
@Bob
Please don’t tell lies on here when the union puts out a newsletter every month with updates, They have not offered any of that so stop telling lies
And any would anyone believe the union lies?
@bob
Here is the union newsletter to read so people can see you like to tell lies.Also next to no progress has been made in 3 years…
https://static1.squarespace.com/static/620bdb7c8857ee6ad49debe3/t/66fc6dbdb727601ebe522314/1727819198348/N.N.+10.02.24+FINAL.pdf
It’s nearly identical except ground pay or any retro pay. That’s a small detail. That’s like asking Mrs Lincoln aside from that one incident how did you enjoy the play…
If FAs and Sara Nelson has confidence in the health of United Airlines, they should buy some stock as part of a balanced portfolio.
We did that once and we all got royally fcuked since the stock went to zero….
If so, the FA’s have no confidence in the long term viability of United Airlines. Therefore, they should support propping up the stock by stock buybacks. The fact that they aren’t just shows that they are the bad guys.
No competent advisor has you buying stock in the company that employs you, unless they let you buy stick at a discount (which you sell as soon as allowed). A lot of Enron employees needed that advice.
Sara Nelson is why the “C word” still has its uses.
Stock buybacks are not stock manipulation in any sense different than paying dividends. They do not hurt workers or customers unless you believe free cash flow should be returned to workers in raises or customers in lower prices rather than providing an ROI for shareholders (whose return is -18% in last 5 years). If you care about customers then you wouldn’t pull work stoppage BS. I am tired of unions saying “here’s what we want, give it all to us, or you’re the jerk, because we never request anything not fair.” She shows little understanding of economics, but a good one of Trump-like tactics.
Hi Dave,
If you pay attention you would understand that is literally not what she’s saying. She said United Airlines refused to offer even what American has been offered which is the new baseline. They are the frontline employees and they are clearly not negotiating in good faith when they can do stock buybacks but not take care of their frontline employees first. That is the major issue and many of the flight attendants are very upset. It’s not a great look to customers either approaching a holiday season with a strike vote in place that’s another reason why the issue is being highlighted
That’s not true at all. If Sarah is saying that they haven’t been offered the AA / DL deal plus a dollar, she’s either completely misinformed or flat out lying. This isn’t a monetary issue though, they want insane demands to work rules and work/life balance issues. They want extra staffing over an above what every other airline in the world has because their aging FA’s can’t keep up. If it was just higher salaries this would’ve been over a long time ago.
Now Bob you sound crazy so please go take your meds. You do realize that United has some of the worst staffing off all major airlines yet has the most international flying? More flight attendants on international equals less rushing and a better quality product and customer service to customers. Let’s use basic common sense.
Sarah has no reason to lie about what has been offered and what is not on the table. Part of her job is to be transparent to flight attendants so that they know what is going on currently with negotiations.The conversation will stop here though because I can see you’re crazy. Have a nice day
Yeah Bob the fas want insane things ie like not increasing the duty day to more than 15 hours, like getting a raise especially when inflation has been quite high the past four years, like getting some pay for actually doing work/being on duty thats an especially crazy one…… oh how about not having to work two legs before a 5 hour plus west to east Ted eye?? That’s an absolutely crazy ask isn’t it?? How about not having a 3 hour plus sit before working a red eye. Just nuts you pillock
“She said United Airlines refused to offer even what American has been offered” Even if that’s true (and you don’t sound trustworthy), do you expect UA to start negotiations with “we’ll give you the same deal as AA”? You must be a great negotiator. The price tag says $60. You start, “I’ll give you $60.”
START negotiations? Wake up you muppet! It’s been four years now!! Scott, Scott is that you??
Why do people not understand how dividends / share buybacks work? Why is she saying this is “for Wall Street” when she or the FAs she represent can just buy UA stock? It’s not some hidden thing – this benefits Joe Schmo, your and my retirement accounts, and us Main Street casual investors if we invest in companies that participate in buybacks. Why is this a “Wall Street” boogeyman? When a company works for its shareholders, do alarmists realize that this includes Main Street’s 401Ks and personal investment accounts, too????
Can’t she be brought up on sedition or terrorism charges?
She needs some AD. Remind her who’s in charge.
Thanks for the prompting to sell my United shares for a $5k gain today!
Imagine being mad that the owners of the company are getting some return on their investment …
Sara Nelson is a stupid, petulant child.
Why do I feel that United’s passengers are the children caught up in a contentious divorce? Will anyone be happy, ever? Figure it out with the union. End of story. And then can we all move on?
If United has a bunch of cash it doesn’t know what to do with, how about it use the money to repay the taxpayers for the covid bailout?
Hear! Hear!
Didn’t the government, wisely I might add, put in a caveat with the CARES money? Thought it was something like we have buy your stock at whatever price it was in 2020 and we can exercise options in the future? I thought they had a 5 year time span to act. Or am I just dreaming that part?
Some y’all have zero compassion and I would hate to meet many of you. These flight attendants are literally paid less than Delta, American, Southwest and I heard even JetBlue is paying more starting off now which is crazy considering they are struggling and a much smaller company. United was second to Delta in revenue so there should be no reason why they do not have a contract and United is asking for non stop concessions.Looks like it will get ugly real soon as the flight attendants are growing more and more upset plus there has been next to no progress. United needs to make them a top priority and stop the excuses
Why? What are FA’s offering in exchange? Will they in turn actually take pride in their work and customer facing interactions?
The level of awfulness with FA’s today at UA make it hard to feel any empathy. While I’m no fan boy of Kirby, it might be his having the balls to challenge FA’s to walk is the right one. Replace them all with Starbucks Baristas who will gladly provide better service to Paris, London, or Tokyo.
FA’s have a real problem. They are expendable, becoming too expensive, and customers are exhausted by them. Now that’s a recipe for, as you said, getting ugly real soon.
Sure man, replace them all with Starbucks employees who still won’t want to work the job as it will pay less after you adjust for all of their unpaid hours. And oh wait they are also trained in safety procedures etc. let’s not forget that little thing.
I find it funny with all these people expecting great customer service from underpaid flight attendants. If they gave you great service on their salary now then there is no incentive for the company to pay them more. I’d also add if being a flight attendant was so easy, why do 50% fail training and a further 50% of the ones that get through quit within their first year?
While I agree I’d prefer to have an enthusiastic flight attendant and often get frustrated by the service of older flight attendants, I’d much rather have one that has gone through training 10 times, been on numerous flights and have managed the safety procedures thousands of times when an emergency strikes than the fresh Starbucks employees that you suggest hiring that will quit anyway…
Emergency expertise? You mean like getting on the com and requesting the assistance of a doctor or law enforcement? Mall security has more training.
After 1.2 million miles on UA, I can only remember a handful of negative experiences, but I remember dozens of positive ones. If the FAs are successful in their negotiations and get a better contract, I’m not going to wish bad things on them. UA shareholders are doing just fine with their free gift of taxpayer funded swimming pools of cash. The comments reinforce a bizarro world where there is a lot of self hatred and misogyny all wrapped up without any accountability. Spew away!
“UA shareholders are doing just fine” I’m guessing you have no idea how UA stock has done in the last 5 years. It is MINUS 18%. But, of course, you don’t want facts interfering with your biases.
What’s it done over 1 year, 2 years, 3 years, 10 years, 15 years and 20 years? Or are you just cherry picking one data point that shows United’s share price has fallen because you picked literally right before COVID?
-1.58 % over 10 years. Yes, they’ve had an 88% return in the last year when SP500 grew by about 33%. But, given 5 and 10 year returns are all negative, this “rebound” of sorts in hardly impressive. The SP500 gas had a 13+% annual return of the last 10 years.
1) Stop investing in airline stocks if you want to make money.
2) I think what you mean is thank you for being bailed out during the pandemic.
3) Investing does not guarantee a return.
4) See 1.
Yes Darin , I wish the government hadn’t stepped in and let a big one fail. You would be the first Jabroni demanding government intervention when fares rose and rose due to a huge amount of capacity being removed from the system. That would have worked out well. You cannot have it both ways..
And, that why my only exposure to airlines is in very small amounts through index funds. The fact UA got government help during the pandemic makes the negative 10 and 5 year returns look worse.
Buy back stock, prices rises, Kirby gets a big bonus. In no way is this positive. Invest in employees or pay down debt, that’s the smart play and do not count on another taxpayer bailout when the next crisis hits. Pure GREED on Kirby’s part.
Any informed investor, and particularly the long term one, prefers stock buybacks to dividends. Any firm that ties bonuses to share price unadjusted for buy backs is making a stupid choice.
Here’s a thought: RELEASE US!!
Heres a thought. A Union Executive that cannot win a strong contract? Needs replaced ASAP! Clearly Sara can’t do the job, and the Membership can’t be bothered to kick her out and find a replacement. A Union is only as strong as its Members. Start doing instead of talking..
The union should just be the FA labor contractor. Let the unions determine marketable labor rates that cover the cost of their FAs pay, healthcare, retirements, etc. It wouldn’t hurt if the unions could lead and demonstrate running a business that pays their FA above and beyond with all net profits.
First, she doesn’t give a crap about customers. Never did.
Second, how on earth does the money United earns, after already paying those lazy and entitled stewardesses everything they owe them, “belong to the workers?”
Time to de-mob the labor movement, and send this unhinged bitch packing.