United Airlines Holdings, Inc. UAL

United Airlines demonstrated significant resilience in 2025, navigating a challenging macro backdrop and idiosyncratic issues like the Newark challenges and a government shutdown. Despite these headwinds, the company expects to be the only U.S. airline to grow EPS year-over-year. This performance is attributed to a decade-long strategy focused on building a revenue-diverse, brand-loyal airline, which has proven remarkably successful and resilient.

The operations team delivered strong results in 2025, achieving the highest seat completion factor in company history and ranking #1 among the big 3 legacy carriers. United flew a record 189 million passengers and ranked #1 in STAR D0 for the second consecutive year. Investments in the customer experience, including new United app features like enhanced mobile bag tracking and real-time boarding updates, contributed to an almost 3-point increase in Net Promoter Score for the year.

United achieved industry-leading cost performance in 2025, with CASM-ex up only 0.4% for both Q4 and the full year. This was driven by a strong operational foundation, cultural efficiency, and technology investments. Specific initiatives included overhauling global procurement, which identified and delivered $150 million in run-rate savings, and using sophisticated technology to model demand for tech ops, leading to more productive technicians and a more productive fleet.

For 2026, United's commercial strategy focuses on five key areas: new seasonal capacity shaping for long-haul international schedules, enhanced merchandising of its growing product lineup (including a major united.com redesign), enhanced connectivity to meet United Next Plan goals by 2027, MileagePlus program enhancements, and continued premiumization. The company expects premium capacity growth to account for more than half of its total growth in 2026.

United expects to take delivery of over 100 narrowbody and approximately 20 widebody aircraft in 2026, contributing to fleet modernization and up-gauging. 2025 marked the high watermark for domestic capacity growth under the United Next Plan, with future growth beyond 2027 increasingly focused on gauge rather than more flights. The company aims to expand its network and scope with new aircraft like the A321XLR, similar to how the 757 was utilized in the past.

Becoming investment-grade rated is a major priority. In 2025, United paid off $1.9 billion of high-cost COVID-era debt, reducing its total cost of debt to 4.7% and net leverage to 2.2x. The company received five credit rating upgrades and is now just one notch below investment grade at all three agencies. United plans to delever further in 2026, targeting net leverage below 2x and aiming to achieve investment-grade metrics by year-end.

Despite competitive growth from another airline in Chicago, United's Chicago hub remained profitable in Q4 and full-year 2025, generating a $500 million profit. United maintains a significant lead in local market share (22 points) and business customer share (38 points) with Chicago-based customers. The company plans to aggressively respond to competitor growth in 2026 by adding flights to maintain its gate count and ensure its Chicago operations remain profitable, even as the competitor is projected to incur significant losses.

Scott Kirby emphasized that the primary constraint on industry capacity is not aircraft deliveries but engine availability, with approximately 800 aircraft globally grounded due to engine issues. He projects that engine manufacturers will not catch up^📎 with demand until the next decade. Kirby believes the industry structure will evolve to two brand-loyal airlines (United and Delta) and low-cost carriers shrinking to a niche of big leisure markets, with unprofitable capacity eventually exiting the system, particularly during the next economic downturn.