JetBlue Airways Doubles Q3 Profit

JetBlue Airways' third-quarter profit more than doubled from a year earlier, as cheap fuel and revenue from checked bag fees and first-class seats added to its bottom line.

The US budget carrier earned USD$198 million in the third quarter, up from USD$79 million a year ago.

JetBlue said it will make less money per mile in October than it did a year ago. The airline has managed to avoid steep declines in unit revenue because it has few flights to Dallas and Chicago, where capacity has outpaced demand, unlike American Airlines and Spirit.

JetBlue also has won corporate customers since adding first-class seats in 2014, offering prices below those of rivals, and started charging lower-fare customers for a first checked bag for bookings after June.

JetBlue expects to earn at least USD$80 million this year from bag fees as well as tweaks to fees for reservation changes - up from a target of USD$65 million.

Despite this, it said passenger unit revenue will fall about 2 percent in October before improving in November and December. The measure, which compares sales to capacity, fell 0.6 percent in the third quarter.

At Southwest Airlines, the measure fell 4 percent in the third quarter.

"We don't believe that the revenue outperformance has started to slow," JetBlue chief executive Robin Hayes said.

Extra flight capacity has also contributed to the drop.

JetBlue said capacity in 2015 is expected to rise between 8.5 and 9.5 percent from a year ago versus a prior outlook of a 7 to 9 percent increase. It cited fewer cancelled flights and adding service with first-class seats to meet demand.

JetBlue expects "high single digit" capacity growth in 2016.

It said a new credit card agreement for frequent fliers with Barclays, to be announced early next year, could boost revenue.