• United Airlines, AT&T, Boeing and Tesla all reported earnings this week, with each one beating profit expectations but revealing underlying pressures including outlook cuts and weaker cash flows.
  • Results reveal short-term resilience despite longer-term headwinds from elevated oil prices, rising capital expenditures, and intensifying competition across airlines, telecom, aerospace, and electric vehicles.

As earnings season rolls on, four major companies reported results this week.

United Airlines, AT&T, Boeing, and Tesla were all in the spotlight, and together, their updates gave investors a mixed picture.

Some delivered solid short-term results, but longer-term concerns around higher oil prices, weaker cash flow, rising spending, and manufacturing pressures continue to weigh on the outlook.

United Airlines Beats Estimates but Cuts Outlook

United Airlines reported strong first-quarter results, with growth in earnings, revenue, and margins. But despite the solid quarter, the airline warned that higher fuel costs could create headwinds later this year.

United posted Q1 earnings of $1.19 per share, ahead of the $1.07 forecast. Revenue came in at $14.61 billion, up 10% year-on-year and also above expectations of $14.37 billion. ⁽¹⁾

CEO Scott Kirby said the results reflected the resilience of the airline’s strategy, even as fuel prices remained elevated.

Jet fuel prices in the US have eased from the $4.78 per gallon level reached earlier this month to around $3.51 per gallon. Even so, United expects fuel prices to average $4.30 per gallon in the second quarter, and now sees Q2 earnings at around $2 per share. ⁽²⁾

The company also cut its full-year earnings guidance sharply. It now expects $7 to $11 per share for the year, down from its earlier January forecast of $12 to $14 per share. ⁽³⁾

United is not alone. Other airlines are also becoming more cautious as higher fuel prices make the outlook less certain. Even so, airline executives said demand remains strong, despite higher fares and increased baggage fees being passed to customers.

AT&T Beats Expectations Despite Lower Cash Flow

AT&T also reported better-than-expected earnings, but its share price still fell after the release as investors focused on weaker cash flow and ongoing concerns around its business mix.

The company reported earnings of $0.57 per share on revenue of $31.5 billion, with both numbers coming in above forecasts. Growth was supported by gains in both wireless and home internet subscriptions. ⁽⁴⁾

Still, free cash flow fell to $2.5 billion, down from $3.1 billion a year earlier, mainly because of higher capital spending on fiber expansion. AT&T left its full-year guidance unchanged, including EPS of $2.25 and free cash flow of $18 billion. ⁽⁵⁾

There were some encouraging signs underneath the surface. The company added 294,000 mobile subscribers in the quarter, ahead of expectations, and added 512,000 residential internet customers. ⁽⁶⁾

Management also pointed to progress in its strategy of selling multiple services to the same household. AT&T said nearly 45% of its home internet customers also use its wireless service, which could help support customer retention and longer-term revenue stability.

Boeing Reports Improvements Across Businesses

Boeing reported improvements across its business segments, especially in commercial aircrafts, which remains the company’s main growth engine.

Boeing posted a loss of $0.20, but this was smaller than what Wall Street expected. Revenues looked strong, coming at $22.22 billion, also topping forecasts. ⁽⁷⁾

CEO Kelly Ortberg, who took over in August 2024, continues working to address the safety and manufacturing challenges that have cost Boeing billions of dollars in recent years. The company noted it has not seen a slowdown in aircraft orders since the Middle East conflict began in February.

Boeing’s commercial aircraft division delivered 143 airplanes in the first quarter, up 10% from the prior year. The unit generated revenue of $9.2 billion, a 13% increase, but remained unprofitable despite higher deliveries and revenue growth. The defense segment saw revenue rise 21% while services increased 6%. ⁽⁸⁾

Overall, the results suggested that Boeing is making progress operationally, even if profitability remains a challenge.

Tesla Beats Earnings but Announces Higher Spending

Tesla reported first-quarter earnings above expectations, although revenue fell short of forecasts and the company announced significantly higher spending plans.

The electric vehicle maker reported earnings of $0.41 per share, beating the expected $0.37 per share. However, revenue of $22.39 billion missed estimates of $22.64 billion. ⁽⁹⁾

Tesla also said capital spending will rise more than previously expected. The company now plans to spend $5 billion, while CFO Vaibhav Taneja said total capital expenditure this year will exceed $25 billion, nearly triple last year’s $8.6 billion. ⁽¹⁰⁾

In the first quarter alone, capital expenditure jumped 67% to $2.49 billion.

On the operating side, revenue rose 16% year-on-year, with automotive revenue also up 16% to $16.2 billion. Tesla delivered 358,023 vehicles in Q1, up roughly 6% from a year earlier. ⁽¹¹⁾

Tesla’s stock is down 14% year-to-date, as the company faces growing competition from rivals such as BYD and Xiaomi in China. So, while Tesla delivered an earnings beat, investors now have to weigh that against rising costs, heavier capital spending, and a more competitive environment.

Sources: ⁽¹⁾ ⁽²⁾ ⁽³⁾ ⁽⁹⁾ ⁽¹⁰⁾ ⁽¹¹⁾ CNBC, ⁽⁴⁾ ⁽⁵⁾ ⁽⁶⁾ Wall Street Journal, ⁽⁷⁾ ⁽⁸⁾ Reuters