American Airlines Takes $78 Million Hit On Republic Stake, Its Regional Partner Still Paid $184 Million In The Quarter
The 10-Q marks the 20.8% Republic holding down to $187 million, while expense under the capacity purchase agreement kept running.
A $78 million impairment hit American Airlines' 20.8% holding in Republic Airways Holdings, the 10-Q filed Thursday shows. Republic's subsidiary also flies regional routes for American, which booked $184 million of expense under that contract in the third quarter.
What the 10-Q says about the stake
The filing says American decided the drop in fair value of its Republic Holdings investment was other-than-temporary. The investment was written down to its quoted market value, with the $78 million charged as a nonoperating special item.
The stake stood at $187 million at September 30, against $254 million at December 31, 2025. The prior quarter's filing carried it at $259 million at June 30, per our draft's comparison. Ownership stayed at 20.8%.
The China Southern Airlines stake also fell, to $104 million from $203 million at year-end. Total equity investments were $408 million, down from $603 million at December 31, 2025.
The supplier is also the investment
Republic is the carrier American pays. The filing records $184 million of expense under the capacity purchase agreement in the third quarter, versus $177 million a year earlier, and $548 million for nine months, versus $519 million.
The impairment sits inside $95 million of nonoperating special charges for the quarter. Pre-tax loss was $334 million versus $142 million a year earlier, and net loss was $269 million, or $0.41 per share. Excluding special items, pre-tax loss was $222 million versus $139 million.
Fuel does most of the damage
Fuel expense rose $1.9 billion, or 67.5%, to $4.6 billion, as the average price reached $3.85 a gallon from $2.37. The filing says American had no fuel hedges outstanding at September 30 and is fully exposed to price swings. Spot prices this year ranged from roughly $1.86 to $4.78 a gallon.
Revenue rose 19.3% to $16.3 billion. At Wednesday's close, shares were $12.23.
What to watch
The 10-Q says American and JetBlue filed an opposition in October to a July motion for class certification, limited to purchasers of flights to or from Boston between April 1, 2021 and July 28, 2023. The court's ruling on that motion is the next step in the antitrust case.
The filing leaves the antitrust class-certification motion pending, with American saying it believes the suits are without merit.
Sources
- 10-Q Filing — American Airlines (AAL) — SEC EDGAR
- 10-Q Filing — American Airlines (AAL), Q2 FY2026 filed 2026-07-23 (comparison basis) — SEC EDGAR
- Earnings release (8-K Item 2.02, a8kerexhibit991q3-26.htm) — American Airlines, filed 2026-10-22 — SEC EDGAR
- American Airlines Stock to Report Q3 Earnings: What's in the Cards? — Yahoo Finance
- United Leads Airline Rebound Despite Tough Q3, Soaring Fuel Costs | Investor's Business Daily — investors.com
- American Airlines (AAL) Q3 2026 earnings — CNBC
- United Airlines Jumps 6% as Record Revenue Forecast Outweighs Fuel-Cost Squeeze; American Airlines Climbs 4%, Delta Rises 3% — Yahoo Finance
- American Airlines: Q3 Earnings Snapshot — Associated Press
