JetBlue Will Pay Dearly to End its Alliance With American Airlines

JetBlue Airways was always going to lose some revenue by ending its alliance with American Airlines in the northeastern U.S. The hit, disclosed Tuesday, is big and will cut the carrier's full-year profit per share outlook down by at least a fifth.

The New York-based airline expects ending the alliance, known as the "NEA," will reduce full-year earnings per share, a measure of profits, by $0.20-25 in 2023. To put that in perspective, JetBlue in April forecast full-year earnings per share with the alliance to be $0.70-1.00. Now, it expects the profit metric to be a measly $0.05-0.40 in 2023 after ending the alliance. The air traffic control staffing-related cancellations in New York and the shift in travel patterns to international trips this summer also weigh on the airline's full-year outlook.

"Our decision to terminate the NEA will result in a near-term drag on margins as we lose key codeshare revenue," JetBlue CEO Robin Hayes said Tuesday. And, in addition to