In addition to downgrading its forecast, American Air, the company also pointed out a substantial increase in fuel prices compared to its initial guidance issued on July 20.
The decline in AAL's stock price had a ripple effect on its peers in the industry, with several other major airlines also witnessing declines.
American said it sees adjusted profit between $0.20 and $0.30 for its third quarter, a substantial downward revision relative to the prior range of $0.85 - $0.95. Analysts were expecting the company to lower its EPS outlook to $0.65.
The capacity is now seen at +6.5%, up from the prior forecast of +6%. The total revenue per available seat mile is now seen in the range of -5.5% to -6.5%, compared to the prior -4.5% to -6.5%.
Similarly, Spirit Air (SAVE:US) slashed its Q3 revenue guidance, prompting its shares to drop as well.
At the market open on Wednesday, AAL and SAVE shares fell 4.1% and 3.2%, respectively.