JetBlue used its quarterly earnings call Tuesday to present what president and incoming CEO Joanna Geraghty referred to as the airline's "Plan B," in case the court decision that blocked the airline's acquisition of Spirit Airlines does not get overturned on appeal.
Joanna Geraghty
"Our hope is that the First Circuit realizes the decision is erroneously decided and we continue down the path with the Spirit acquisition," Geraghty said, referencing the federal First Circuit Court of Appeals.
But during the call, Geraghty at times sounded as if she's already of a mindset that the Spirit merger will not materialize.
"Spirit was about accelerating our organic growth," she said, using the past tense, in response to one question from a financial analyst. "More JetBlue to more places, more people. We still intend to do that. We are going to do it organically. It will be a bit slower for sure."
For 2023, JetBlue reported a net loss of $310 million, with a pre-tax operating loss of 3.5%. Its challenges accelerated in the fourth quarter, with the airline suffering a net loss of $104 million on a pre-tax operating loss of 4.7%.
Under the Spirit-free plan, JetBlue would seek to reverse its losses by reining in costs, refocusing on core markets from New York and Boston, and developing new revenue initiatives.
Some measures to be taken toward that strategy are already moving ahead. The airline said Tuesday that it has reached an agreement with Airbus to defer nearly 50 planned aircraft deliveries through 2027, valued at approximately $2.5 billion, until 2028 and after.
Fewer deliveries will enable JetBlue to slow growth while recalibrating its network. For this year, JetBlue is projecting to fly slightly less capacity than in 2023.
Within the past week, JetBlue also launched voluntary opt-out packages for employees, mostly those working in customer-support centers.
JetBlue also plans to undertake 15 revenue initiatives this year, which is expected to produce $300 million in incremental revenue, including approximately $200 million of ancillary revenue. One such initiative, to begin in the coming months, will be the launch of paid seat selection for well-located economy seats.
Other elements of the revenue plan: aggressively reallocating aircraft from underperforming routes to key premium leisure markets and expanding JetBlue's presence in online travel agencies.