United held its quarterly call on financial results this morning. And the consistent message throughout the call was that they’re going to do a lot of things differently, they just won’t tell us what yet.
They’re want to talk about things like basic economy fares and about new IT investments. They’re going to talk about how they’re forecasting revenue. But over and over they punted to say they’d talk about those things at next month’s investor day… the refrain got so old that CEO Oscar Munoz made a chuckle out of punting to investor day.
Here’s what Oscar Munoz’s office looked like after the call:
I did find interesting in response to a question from Hunter Keay (Wolfe Research) that United doesn’t have a process to measure forecast revenue versus actuals on a market-by-market basis. According to new President Scott Kirby, for instance, Christmas this year is on a Sunday and since they don’t have historical data on that, they also don’t have much computer input into that and they’re hand-managing.
According to Kirby the ‘fundamental architecture’ that the system is built on can handle planned improvements so they need to build on top of the current architecture versus replacing it. So it sounds like United is stuck with SHARES.
He described the pricing environment having started to change in favor of airlines, dating to mid-August, and he refused to explain further publicly.
At American, Kirby claimed 87% of customers fly once a year or less driving half of revenue. He was asked for similar numbers at United and reported it was 85% of customers. The flip side of course is that 15% of customers are flying more frequently and driving and outsized portion of revenue.