April 16 (Reuters) - United Airlines UAL.O shares rose on Wednesday in premarket trading, lifting up peers, after it said forward bookings were stable so far in the current quarter despite tariff-induced economic uncertainty.
Shares of the carrier were up nearly 6% premarket and on track to recover some of their losses from what has been a tumultuous last few months for U.S. airlines. United shares have fallen 31% this year.
Trump's trade policies and sweeping tariffs have sparked a global trade war and raised the odds of the world spiraling into recession, making customers hesitant to spend on travel.
Expectations of a gloomy demand environment prompted airlines to take a prudent approach with capacity and cost controls. Several U.S. airlines have started cutting flights to avoid lowering fares and to protect margins.
United on Tuesday reported better-than-expected first-quarter earnings and said forward bookings for high-margin premium cabins rose 17% over the past two weeks, with international reservations up 5% during the same period.
This lifted peers American Airlines AAL.O and Delta Air DAL.N up 1.6% and 3.4% respectively. Domestic rival Southwest Airlines LUV.N also rose 2.6%.
United, however, warned its financial forecast for the year was dependent on the macro environment, which it added was "impossible to predict this year with any degree of confidence."
If recession occurs, it would lead to a 5-percentage point drop in its revenue and translate into a full-year adjusted profit of $7 to $9 a share.
In January, it had forecast 2025 adjusted profit of $11.50 to $13.50 per share.
It still expects to hit its full-year forecast if demand remains stable and fuel prices stay around the current levels.
"The prepared remarks encouragingly note demand has stabilized over the past 6 weeks. That factor combined with favorable fuel leads the company to believe it can achieve its initial FY25 EPS guidance," TD Cowen said in a note.
This stands in contrast to rival Delta Air Lines DAL.N, which withdrew its full-year outlook last week, citing "stalled" demand growth.
(Reporting by Shivansh Tiwary in Bengaluru; Editing by Shinjini Ganguli)
((Shivansh.Tiwary@thomsonreuters.com; +91 9708363192; X: @Shivansh_19_;))
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