American Airlines, Spirit Airlines cut summer profit forecast on higher costs

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American Airlines

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Spirit Airlines warned on Wednesday that higher costs will hit profits during the busy summer quarter. Mario Tama | Getty ImagesAmerican Airlines

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Spirit Airlines

on Wednesday joined other carriers in warning that higher costs will hit profits during the bustling summer quarter.

American said it expects adjusted earnings per share to come in between 20 cents and 30 cents in the third quarter, down from a previous forecast of as much as 95 cents a share, citing more expensive fuel and a new pilot labor deal. Spirit Airlines is expecting negative margins as high as 15.5% for the three-month period ending September 30, compared to an earlier estimate that was -5.5% – -7.5%. The budget airline also cut its revenue forecast for the third quarter.

Airlines have lost the pricing power they commanded last summer when capacity was more constrained coming out of the pandemic, even though demand has been strong.Fare-tracking company Hopper on Tuesday said it expects fares to continue dropping in the fall shoulder season, with domestic U.S. tickets averaging $211 in September and October, down 30% from the peak of summer.Shares of American and Spirit were down in premarket trading on Wednesday. Southwest Airlines and

Alaska Airlines

cut their third-quarter forecasts earlier this month.01001010Airlines start reporting third-quarter results in mid-October.01001010