American Airlines Reports $1.25 Billion Loss, 1,600 Voluntary Employee Buyouts

American Airlines said Thursday that the company lost $1.25 billion in the first quarter and is continuing to cut costs.

The airline said it burned through $27 million in cash each day in the quarter, down from $30 million a day in the fourth quarter of 2020. American reduced 2021 costs by more than $1.3 billion, including delaying delivery of new jets and a new round of voluntary buyouts that will result in 1,600 employees leaving the company.

"We are incredibly proud of the American Airlines team for their continued care of our customers and each other," Chairman and CEO Doug Parker said in a statement. "Our team has shown up every day throughout the pandemic and served more customers than any other airline. That focus has served as our inspiration and positions us well as even more customers return to the skies.

Looking forward, Parker said the company is seeing signs of "continued recovery in demand" and is confident that the network enhancements, customer-focused improvements, and efficiency measures the company has put in place will ensure a "well-positioned" recovery for American.

For more reporting from the Associated Press, see below.

American Airlines
American Airlines reported a $1.25 billion loss in the first quarter of 2021, but CEO Doug Parker is optimistic that travel demand will pick up soon. In the photo, an American Airlines plane at sunrise on the tarmac at Reagan Washington National Airport in Arlington, Virginia, on April 22, 2021. Daniel SLIM/AFP via Getty Images

The airline industry has taken a major hit during the COVID-19 pandemic and received $54 billion in grants to pay workers over the past year and $25 billion in loans from the federal government.

While leisure travel within the U.S. has picked up recently, with about 1.4 million travelers going through airports each day this month, it remains about 40% below the pre-pandemic pace of 2019.

With less traffic, American reached a deal with Boeing to delay delivery of 23 737 Max jets until 2023 and 2024 and convert five of those to a larger version of the plane. American expects to take 14 Max jets over the next 12 months.

The first-quarter loss was roughly in line with Wall Street expectations. Excluding federal payroll aid and other temporary items, American said it lost $4.32 per share. The average estimate of 17 analysts surveyed by FactSet was a loss of $4.30 per share.

A year ago, American lost $2.24 billion. Revenue was $4.01 billion, just shy of the $4.04 billion forecast by analysts and down 53% from $8.52 billion a year ago.

Shares of Texas-based American Airlines Group Inc. rose 2% in trading before the opening bell.

Correction (4/22/2021, 3:45 p.m.): The headline was changed to better reflect the voluntary job opt-out program from American Airlines