American Airlines CEO Robert Isom discusses consumer demand amid the war in Iran, new offerings for customers, where he sees opportunities for growth, and how the company is set up to deal with higher fuel costs.
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What Robert Isom said
Written from the verified transcript and checked against it. Every figure links to the moment it was said.
Robert Isom, CEO of American Airlines, said travel demand remains robust despite elevated fuel prices, with first-quarter revenue up 10-11% year-over-year and a forecast of 15% growth. He noted business travel is up 13%, and premium demand is outpacing leisure. Isom acknowledged a $4-5 billion fuel cost shock for 2026 but expressed confidence in passing costs through and maintaining profitability. He highlighted investments in premium products like flagship suites on 787-9s and 321 XLRs, with premium seating growing at twice the rate of main cabins. On capacity, he said American has pulled some capacity and will adjust as needed. He dismissed a merger with United as anti-competitive, and said American will grow organically, opportunistically acquiring planes and gates, not entire airlines. He expects pre-tax margins to return to high single digits and believes oil prices will moderate once the Middle East conflict resolves.
Key takeaways
American Airlines forecasts 15% year-over-year revenue growth, with Q1 revenue up 10-11%.
Business travel is up 13% year-over-year, and premium demand is outpacing leisure.
Fuel price spike adds $4-5 billion in 2026 costs, but Isom expects to pass through and maintain profitability.
Premium seating capacity will grow at twice the rate of main cabins, driven by new 787-9s and 321 XLRs.
Isom ruled out a merger with United, calling it anti-competitive, and focuses on organic growth and opportunistic asset acquisitions.
2:27How much of that can you pass along to customers?
3:34In other words, when you are passing along price increases, do consumers push back or are they remarkably resilient and just accepting it because that is the status quo across the industry?
5:06Is this a time for mergers and consolidation in that way?
7:23So a marriage between American and United, not in your bingo card?
7:57Do you think that American can thrive even with oil prices where they are today?
8:42Do you think that right now, the way that things are set up, if the prices that we have today at like $90 a barrel or $85 a barrel, you could return to profitability that you would forecast at the beginning of the year?
Right now we are looking at oil prices on a daily basis, as is your share price. Before we get there though, I want to start with just consumer demand. There have been a lot of questions about how resilient consumer demand actually can be as this conflict goes on. What have you seen so far?
People want to travel. I think that there's still some consciousness that travel is still a bit of a bargain. Really, we're just getting back to yields that we had in 2014 and 2019, so that sense of travel is a bargain, I think, is apparent. And what we've seen tremendous demand in the first quarter, American Airlines year-over-year revenue improved 10, 11%. And we're forecasting revenue to improve 15% year-over-year. And that's some additional capacity in there, but a lot of unit revenue performance as well, which suggests that people are finding great value in travel.
It's all of the above. And it's business, it's leisure, it's domestic, and also international is still leading the way. Premium is still outpacing leisure. But I really like what I see. And in terms of capacity, I think that it is responding to market dynamics. I think that the industry is stretched in terms of margins, and at least for us, I like what I see in terms of how we were set up.
We've pulled a little capacity out and will of course take a look at what's happening later in the year. We're very margin conscious. I mean, at the end of the day, that's what we're in business to do. But right now demand is very robust. And as we look at that, closing out the second quarter, we're going to close out the second quarter in a really strong fashion.
Have you seen any businesses pull back on business class travel? We've heard some companies start to discuss that type of measure just because of the costs. Have you seen anything like that?
Not at American. Business travel is up 13% year-over-year. And I think it's really responding to some of the things that we've been laser focused on. We have four pillars. One is elevating customer experience, growing back our network, really make sure we're driving premium revenue, and then leading in loyalty. And all of those are resonating with our customers right now. And American has done better year-over-year on a quarterly basis. That's five out of six quarters in terms of unit revenue production. So I like what I see.
You've talked about how there's an estimated 4 to 5 billion dollars of costs for 2026, as a result of fuel prices being elevated. How much of that can you pass along to customers?
Well, it's a big shock right now. And I am very confident that as things even out, that will translate into gains for American and our shareholders. If you take a look back at the first quarter, we were projecting solid profitability in the first quarter, which is usually a tough quarter for us, but for the shock in fuel prices. And the same thing. Think about in a year where the price of fuel has spiked 4 or 5 billion dollars, we're still projecting the same type of profitability that we had last year. That means good things in terms of what we hold. I really do think that there's some stickiness to a lot of what we're doing and its upside that's unique to American. But there's a rising tide as well. Everybody's got to be margin conscious. And of course, there's been some struggles in the business among those that are serving the lowest cost demand or the lowest revenue demand.
Just to sort of put a bow on that. In other words, when you are passing along price increases, do consumers push back or are they remarkably resilient and just accepting it because that is the status quo across the industry?
11 more exchanges in this transcript
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Isom, R. (2026, May 27). American Airlines CEO Sees Tremendous Demand for Travel [Interview transcript]. Bloomberg Podcasts. CEOInterviews.AI. https://ceointerviews.ai/interview/942575/
MLA
Robert Isom. "American Airlines CEO Sees Tremendous Demand for Travel." Bloomberg Podcasts, 27 May. 2026. Transcript, CEOInterviews.AI, https://ceointerviews.ai/interview/942575/.
BibTeX
@misc{isom2026_942575,
author = {Robert Isom},
title = {American Airlines CEO Sees Tremendous Demand for Travel},
howpublished = {Interview transcript, Bloomberg Podcasts. CEOInterviews.AI},
year = {2026},
month = {may},
url = {https://ceointerviews.ai/interview/942575/},
note = {Speaker-attributed transcript with timestamps}
}
