Air Transport World

JetBlue Airways.(US Nationals)(Brief Article)

The financial law of gravity finally may be catching up with JetBlue, as it reported that earnings for the first quarter of 2004 actually fell 12.5% to $15.2 million from $17.4 million the year before on a 42% rise in RPMs. Heretofore, earnings had only climbed, as in 2003 when it posted a 12-month profit of $103.9 million, up 89.2% over 2002, on revenues of $998.3 million, up 57.2%.

Soaring fuel prices were certainly partly responsible for the earnings drop, as were rising maintenance costs as aircraft came out of warranty--maintenance costs soared 275% in the first quarter--but the bigger challenge is on the revenue side, where the carrier is engaged in aggressive expansion, particularly in transcon markets, and the legacy airlines are hitting back hard. …

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