United Airlines revenue grew in the third quarter, but higher fuel costs cut its margin
Revenue grew 17.4% to $17.9 billion and net income rose 8.4% to $1.0 billion. Operating margin fell to 8.1% and operating cash flow dropped to $465 million.
Revenue
$17.9B
↑ 17.4% vs Q3 FY2025
Operating margin
8.1%
↓ 1.1 pts vs 9.2%
Net income
$1.0B
↑ 8.4% vs $0.9B
Operating cash flow
$465M
↓ 61.8% vs $1.2B
Capital spending
$2.1B
46.1% vs $1.5B
United Airlines' revenue grew 17.4% to $17.9 billion in the third quarter of 2026, compared with the same quarter a year earlier. Costs grew faster, so operating margin fell to 8.1% from 9.2%. Cash from operations dropped to $465 million, and capital spending rose, so free cash flow was negative.
Fares drove revenue growth
Revenue growth was faster than in the second quarter, when it was 16.0%, and the first quarter, when it was 10.6%. In its 10-Q United said: passenger revenue increased $2.4 billion, or 17.6%, primarily due to a 16.8% increase in yield (the average passenger revenue for each mile a passenger flew) and a 2.4% increase in the number of passengers flown. The company's earnings release says capacity, measured in seat miles, was up 1.3%. Most of the growth therefore came from higher fares, not from flying more.
Net income rose 8.4% to $1.0 billion, and diluted earnings per share rose 8.3% to $3.14. For the first three quarters of 2026 combined, revenue was up 14.8% on the same period of 2025.
Fuel took a larger share of revenue
Operating income rose 3.7% to $1.4 billion, slower than revenue, so operating margin fell 1.1 points. The 10-Q gives fuel as the main reason: aircraft fuel expense increased $1.8 billion, or 61.6%, primarily due to a higher average price per gallon of fuel. Operating margin was 6.2% in the second quarter and 6.8% in the first, so the third quarter was higher than either.
Income tax was 21.5% of pretax income, against 24.4% a year earlier.
Cash flow turned negative as capital spending rose
Cash from operations fell 61.8% to $465 million, from $1.2 billion a year earlier. Capital spending rose 46.1% to $2.1 billion. Free cash flow, which is cash from operations minus capital spending, was an outflow of $1.7 billion, compared with an outflow of $246 million a year earlier.
At the end of the quarter United held $14.7 billion in cash and short-term investments against total debt of $26.4 billion. Shareholders' equity was $17.8 billion, up from $14.3 billion a year earlier. United spent nothing on share buybacks in the quarter.
What the company said to expect
In its earnings release the company said: "United expects Q4 total operating revenue growth to accelerate versus Q3 and set another record with an over 20% year-over-year increase". This is the company's own statement, not a forecast by The Filing Desk.
Sources: Form 10-Q (SEC EDGAR) · Form 10-Q filing index · EDGAR company facts for United Airlines · United Airlines third-quarter 2026 earnings release (Exhibit 99.1). More figures for United Airlines are on its company page.
Twelve quarters of figures
| Quarter | Q4 '23 | Q1 '24 | Q2 '24 | Q3 '24 | Q4 '24 | Q1 '25 | Q2 '25 | Q3 '25 | Q4 '25 | Q1 '26 | Q2 '26 | Q3 '26 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $13.6B | $12.5B | $15.0B | $14.8B | $14.7B | $13.2B | $15.2B | $15.2B | $15.4B | $14.6B | $17.7B | $17.9B |
| Revenue growth | 9.9% | 9.7% | 5.7% | 2.5% | 7.9% | 5.4% | 1.7% | 2.6% | 4.8% | 10.6% | 16.0% | 17.4% |
| Operating margin | 7.3% | 0.8% | 12.9% | 10.5% | 10.2% | 4.6% | 8.7% | 9.2% | 9.0% | 6.8% | 6.2% | 8.1% |
| Net income | $600M | −$124M | $1.3B | $965M | $985M | $387M | $973M | $949M | $1.0B | $699M | $805M | $1.0B |
| Diluted EPS | $1.81 | −$0.38 | $3.96 | $2.90 | $2.96 | $1.16 | $2.97 | $2.90 | $3.18 | $2.14 | $2.46 | $3.14 |
| Cash from operations | −$910M | $2.8B | $2.9B | $1.5B | $2.2B | $3.7B | $2.2B | $1.2B | $1.3B | $4.8B | $1.6B | $465M |
| Capital expenditure | $2.1B | $1.4B | $1.2B | $1.4B | $1.7B | $1.2B | $1.3B | $1.5B | $1.9B | $1.7B | $1.3B | $2.1B |
| Free cash flow | −$3.0B | $1.5B | $1.7B | $88.0M | $549M | $2.5B | $930M | −$246M | −$604M | $3.1B | $267M | −$1.7B |
| Dividends and buybacks | $0.0M | $0.0M | $0.0M | $82.0M | $80.0M | $349M | $240M | $21.0M | $27.0M | $27.0M | $0.0M | $0.0M |
This story describes figures the company has published. It is for information only and is not investment advice or a recommendation to buy, sell or hold any security. Check the original filings before relying on any figure. Stoqly is not affiliated with the SEC or United Airlines.
