How United Airlines Makes Money

Passenger revenue is beginning to recover from the pandemic shock

United Airlines Holdings Inc. (UAL) is a holding company whose principal subsidiary is United Airlines Inc., which provides air transport for people and cargo worldwide. United has hubs throughout the U.S. and provides service to Europe, Asia, Latin America, Africa, the Middle East, and the Pacific. The company, through contracts with various regional carriers, also offers regional service under the United Express brand. United's primary competitors include Delta Air Lines Inc. (DAL) and American Airlines Group Inc. (AAL).

Like the broader airline industry, United has experienced a drastic downturn in business as a result of the COVID-19 pandemic. In 2021, the company operated at approximately 63% of its total capacity compared to 2019, the first full year prior to the start of the pandemic. United also expects its capacity for 2022 to remain below its 2019 capacity as demand gradually recovers.

Key Takeaways

  • United Airlines provides international and regional transport for people and cargo.
  • United's passenger revenue has begun to recover from the shock triggered by the COVID-19 pandemic, but it is still below pre-pandemic levels.
  • The company expects its capacity for 2022 to remain below 2019 levels.
  • United recently suspended two of its flights to India indefinitely amid a Russian overflight ban.

United Airlines' Financials

United Airlines announced in January financial results for Q4 of its 2021 fiscal year (FY), the three-month period ended Dec. 31, 2021. The company's net loss narrowed to $646 million from $1.9 billion in the year-ago quarter. In Q4 FY 2019, prior to the pandemic, the company generated $641 million in net income. Revenue rose 140.1% year over year (YOY) to $8.2 billion. But it was still down 24.8% compared to the final quarter of FY 2019.

Domestic passenger revenue rose 176.6% compared to the year-ago quarter, comprising about 61% of United's total revenue. International passenger revenue expanded 211.1% YOY, accounting for about 23% of companywide revenue. Cargo and other operating revenue comprised the remaining 16% of total revenue. United said in its earnings press release for the quarter that despite the spike in COVID-19 cases due to the spread of the Omicron variant its bookings for spring travel and beyond remain strong.

United Airlines' Business Segments

United Airlines reports its financial results as a single operating segment. This reflects the company's aircraft deployment system: United deploys aircraft throughout its global network through a single route scheduling system to maximize its value. However, the company does provide a breakdown of its revenue into three separate categories: passenger, cargo, and other.


United's passenger revenue includes revenue generated from ticket sales for passengers throughout its network. The company recognizes passenger revenue when transportation is provided. This category also includes ancillary fees such as premium seat fees, baggage fees, inflight amenities fees, and other ticket-related fees.

In Q4 FY 2021, United's passenger revenue was $6.9 billion, up 185.4% YOY. However, it was still down 30.8% compared to Q4 FY 2019. Passenger revenue accounted for nearly 84% of total revenue for the quarter.


United's cargo revenue is generated from the company's freight and mail services business. These services are provided to commercial businesses, freight forwarder and logistic firms, and the United States Postal Service. In 2020, the company began launching cargo-only flights. However, it expects to reduce and eventually cease these cargo-only flights as long-haul passenger demand increases.

In Q4 FY 2021, United's cargo revenue was $727 million, up 29.8% YOY and 130.1% higher than in Q4 FY 2019. Cargo revenue comprised nearly 9% of companywide revenue for the quarter.


United classifies other revenue as revenue generated from third-party businesses, which includes revenue from maintenance services, flight academy, frequent flyer award non-travel redemptions, and ground handling.

In Q4 FY 2021, United's other revenue was $587 million, up 32.8% YOY. But it was still down 8.1% compared to Q4 FY 2019. Other revenue represented over 7% of the company's total revenue for the quarter.

United Airlines' Recent Developments

On March 7, 2022, United Airlines said that it has suspended two flights to India for an indefinite period of time after it halted flights that flew over Russia the week earlier. Many international flights to Asia are having to take longer routes due to not having access to Russian airspace amid Russia's recent invasion of Ukraine. United halted flights between San Francisco and Delhi and between Newark and Mumbai. It said that it plans to continue offering flights to Delhi from both Chicago and Newark.

Article Sources
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  1. United Airlines Holdings Inc. "Form 10-K for the fiscal year ended December 31, 2021," Pages 3-4.

  2. United Airlines Holdings Inc. "Form 10-K for the fiscal year ended December 31, 2021," Page 36.

  3. United Airlines Holdings Inc. "Form 8-K dated Jan. 19, 2022," Page 12.

  4. United Airlines Holdings Inc. "Form 8-K dated Jan. 19, 2022," Pages 12 & 13.

  5. United Airlines Holdings Inc. "United Airlines Achieves Fourth Quarter Financial Targets and Reiterates Long-Term Commitments -- Despite Headwinds from Omicron Variant."

  6. United Airlines Holdings Inc. "Form 10-K for the fiscal year ended December 31, 2021," Page 67.

  7. United Airlines Holdings Inc. "Form 10-K for the fiscal year ended December 31, 2021," Page 44.

  8. United Airlines Holdings Inc. "Form 10-K for the fiscal year ended December 31, 2021," Page 5.

  9. United Airlines Holdings Inc. "Form 10-K for the fiscal year ended December 31, 2021," Page 6.

  10. Reuters. "United suspends some India flights after Russia overflight ban."

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