Fewer people are flying, but airlines aren’t worried

Fewer people are flying this year, but airline executives say that’s OK when airfares are so high.

The number of people being screened at U.S. checkpoints is on an annual decline for the first time since 2020. Major U.S. airlines said earning higher fares was more important than filling planes or flying record numbers of travelers.

“We are aggressively prioritizing yield over load factor and are very pleased with the results. This is a good fit for the premium investments we are making.” american airlines Chief Commercial Officer Nat Pieper said on Thursday’s earnings call.

American Airlines’ load factor, a measure of how full planes are flying, fell to 83.4% in the third quarter from 86% in the same period in 2025.

Ticket prices have soared as airlines grapple with rising prices for jet fuel, their biggest expense after payroll, and pass much of that cost on to customers.

Fares rose more than 22% in September compared to the same month last year, according to the latest inflation figures. Fares tracking company Hopper said it expects airline ticket prices to be the most expensive in years this holiday season.

average southwest airlines For example, freight rates in the third quarter were $231.69, an increase of nearly $50 year over year. This does not include new charges from Southwest Airlines, such as additional fees for checked bags and seats near the front of the plane.

However, the company’s number of paying passengers decreased by 3.2% from the previous year to approximately 33.5 million.

Still, both fares and passenger numbers exceeded Southwest’s expectations.

“Passenger fares exceeded our expectations by about $3.00, and more importantly, passenger numbers also exceeded our expectations,” Southwest CEO Bob Jordan said on an earnings call Thursday.

By Thursday, about 9.3 million fewer people had been screened at airport checkpoints than at the same time in 2025, according to the Transportation Security Administration, since April, when airlines began warning in earnest about the hit to profits from soaring jet fuel prices. It follows several years of growth, albeit a decrease of less than 2% compared to last year.

With jet fuel prices more than doubling from a year ago, with spot prices on the U.S. Gulf Coast at $4.63 a gallon, according to the U.S. Energy Information Administration, airlines are focused on recouping as much of the soaring fuel costs as possible.

Despite some declines, airline executives said on an earnings call that overall travel demand remained strong, especially for lucrative premium classes such as business class.

Also, not all carriers are in decline. united airlines announced a 2.4% increase in passenger numbers and a 16% increase in passenger spending in the third quarter compared to a year ago, the largest increase since the pandemic.

“We’ve been pleasantly surprised by the industry’s profitability this year and the ability to weather most of the fuel price increases,” Chief Executive Officer Scott Kirby said on Wednesday’s earnings call. “Therefore, it is possible that airlines will continue to focus on yield at the expense of load factor, which alone could enable them to achieve double-digit margins next year.”

Although most airlines expect fuel costs to continue rising, executives say they are confident in their pricing power.

United Airlines, for example, said it expects average fuel prices to be $4.80 per gallon in the fourth quarter, up from an average price of $3.90 per gallon in the third quarter.

American, United; delta airlines Both Southwest Airlines and Southwest Airlines lowered their 2026 profit forecasts when they reported earnings this month. American Airlines is the only airline out of the four that predicts a loss this year.

American Airlines and others have scaled back growth plans and warned that freight rates could remain high as the industry rolls back its capacity expansion goals. The reduction in seating capacity means there will be a shortage of available seats, which could push prices higher if demand holds.

Airlines say demand is particularly high for premium seats, which can cost hundreds if not thousands of dollars more than a bus ticket.

Smaller airlines are expected to report their results in the coming weeks. frontier airlines and allegiant airhas traditionally focused on more price-sensitive customers, which could indicate whether these travelers are holding back at all.

One factor that could impact air travel is the demise of Spirit Airlines, which went out of business in early May.

“Some customers may have stopped flying,” Bank of America said in a research note Thursday.