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JetBlue Airways Corporation (NASDAQ:JBLU) tumbled more than 6% on Thursday afternoon, the most since December 13, after saying it will end its partnership with American Airlines (AAL). Instead, the Long Island City-based airline will focus on its planned acquisition of Spirit Airlines (NYSE:SAVE).
AAL, which is down more than 2%, said it planned to still challenge the Department of Justice ruling on its alliance with (JBLU). Spirit (SAVE) rose about 0.8% in afternoon trading.
Earlier this year, a federal judge ruled that the Northeast Alliance, or NEA, partnership between JetBlue (JBLU) and American (AAL) was anticompetitive and ordered the airlines to undo the accord. The alliance allowed the airlines to share passengers and revenue in the Northeastern U.S.
JetBlue (JBLU) said on Wednesday it disagreed with the ruling but wouldn’t appeal the decision. Instead, the airline said it will “turn even more focus to our proposed combination with Spirit.”
The low-cost airline is expected to report EPS of $0.41 for the second quarter when it publishes earnings on July 25. That compares to an EPS of -$0.02 for the second quarter of 2022.
Last August, JetBlue (JBLU) said that the NEA was “growing well in excess of the U.S. market.”
“The NEA added over 50 new routes, and increased frequencies on another 130 routes,” the company said. “Through the NEA, JetBlue (JBLU) is able to serve a broader set of customers, including business travelers, fly to more markets, and create thousands of jobs in the process.”
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