American Airlines reported adjusted diluted earnings per share of $0.16 for the fourth quarter of 2025, a result that came in well below several analyst projections and drew attention to the financial impact of a recent government shutdown.
According to a Bernstein SocGen Group note cited in research coverage, the $0.16 adjusted EPS compared with an analyst expectation of $0.34, a sizable shortfall. Elsewhere in market reporting, the quarter was characterized as a 57.89% negative surprise relative to a $0.38 consensus forecast noted in company commentary, and the figure also trailed Evercore ISI’s estimate of $0.20 and the broader Street expectation of $0.36.
The company’s quarterly revenue totaled $14.00 billion, narrowly under the $14.04 billion that had been anticipated. Management said the government shutdown reduced top-line revenue by $325 million, a direct hit that analysts pointed to when revising near-term estimates. InvestingPro data referenced in research coverage indicated 10 analysts have trimmed earnings projections for the upcoming period.
Operational and unit metrics
Unit revenue and cost trends reflected the quarter’s pressure. American reported a 2% year-over-year drop in unit revenue while total unit costs rose 4% compared with the prior-year period. Separately, passenger revenue per available seat mile (PRASM) for domestic operations declined 2.5% year-over-year, a segment effect the Bernstein SocGen note said would have shown year-over-year growth absent the shutdown impact.
Profitability measures also weakened. The airline’s pre-tax margin for the quarter fell to 1%, down from 6% in the same period of 2024. Gross profit margin for the period was reported at 23.73%.
Revenue trends and recent growth
Despite the quarterly setback, American’s trailing-12-month revenue stood at $54.29 billion, representing modest growth of 1.27% over the prior twelve months. The research coverage underscored that premium cabin and other premium product offerings continued to outperform main cabin unit revenue during the quarter, marking a relative bright spot amid otherwise softer results.
Analyst reactions and price targets
Bernstein SocGen analyst David Vernon maintained an Outperform rating on American Airlines and kept a $20.00 price target despite the earnings miss. That target implies upside from the trading price cited in the research note of $13.55. InvestingPro commentary noted the current quoted price and labeled the stock undervalued relative to that target.
Evercore ISI retained an In Line rating for the company and kept a $17.00 price target. The broader set of analyst expectations cited in market reporting produced a range of estimates for the quarter, with the reported $0.16 EPS coming in below several of those figures.
Outlook and forecasts
The Bernstein SocGen research note pointed to strong fiscal year 2026 guidance from the company, framing the shutdown-related disruptions as potentially temporary rather than indicative of prolonged weakness. At the same time, InvestingPro forecasts flagged an expected drop in net income for the current year and projected EPS for fiscal 2025 of $0.56.
These competing signals - an earnings miss and weakened margins on one hand, and continued strength in premium products plus positive guidance for the next fiscal year on the other - shaped analyst commentary and investor interpretation of the quarter.
Key takeaways
- American Airlines reported adjusted diluted EPS of $0.16 for Q4 2025, missing multiple analyst forecasts cited in research coverage.
- The company said a government shutdown reduced revenue by $325 million; domestic PRASM fell 2.5% year-over-year.
- Premium product revenues outperformed main cabin unit revenue, while unit revenue declined and unit costs rose.
Context for markets
The quarter’s results and accompanying analyst reactions have implications across airline equities, travel-related services, and sectors sensitive to consumer travel demand and fuel and labor cost dynamics. Revenue and margin pressure at a large carrier can ripple through supplier and distribution networks while influencing relative valuations within the airline peer group.