Two major airlines reported quarterly losses of more than $1 billion each on Wednesday, reflecting the industry's struggle to cope with higher jet fuel costs and an economic slowdown.
But, helped by higher fares, charges for checked baggage and cutbacks in flights, the results topped Wall Street forecasts and their share prices surged.
The losses were reported by the AMR Corporation, the parent of American Airlines, and Delta Air Lines, much of them on large write-downs as they tried to deal with revamping costs before Labor Day, when travel typically drops off.
"Both airlines are taking big write-offs because they're preparing to shrink this fall," said Bob McAdoo, an analyst for Avondale Partners. "Traffic always drops after Labor Day but beyond that, you're also seeing that earnings are down because of the impact of fuel."