NEW YORK ? Higher oil costs overshadowed rising fares and fees in the third quarter for JetBlue Airways Corp., sending its profit down 41 percent.
But despite fears that Americans are tightening budgets, JetBlue said it's not seeing a slowdown in demand.
The New York airline said Wednesday that higher fuel costs and Hurricane Irene, which led it to cancel 1,400 flights, hurt its July-September quarter.
JetBlue earned $35 million, or 11 cents per share, compared with $59 million, or 18 cents per share, a year ago.
Revenue rose 16 percent to about $1.2 billion.
Analysts polled by FactSet Research were expecting a profit of 13 cents per share on $1.18 billion in revenue.
JetBlue's average fare was up about 9 percent to $154.88 during the quarter. It also benefited from new efforts to court higher-paying business travelers in Boston.
But that wasn't enough to account for the airline's rising fuel bill.
JetBlue said its fuel costs jumped 56 percent in the July-September period from a year ago, while overall expenses rose 22 percent. Maintenance costs rose 35 percent.
The airline was one of the hardest hit among U.S. carriers in late August when Hurricane Irene made its way up the East Coast. JetBlue said on Wednesday that the storm cut its operating income by about $8 million in the third quarter.
The storm hit ahead of the important Labor Day holiday. At one point, most major Northeast airports were closed.
JetBlue's traffic in the third quarter rose about 8 percent, while the number of its available seats rose by about the same amount. On average, 84.5 percent of seats were filled with paying passengers, almost unchanged from last year.
The airline expects its number of available seats will rise by between 8 and 10 percent in the fourth quarter and between 6 and 8 percent for the year. It's taking delivery of two new planes before year's end.
In a conference call with analysts, interim Chief Financial Officer Mark Powers said the company is succeeding in its effort to lure more higher-paying travelers. That includes those traveling for business as well as those who select its roomier seats for an extra charge. JetBlue added more of those seats in the third quarter and expects to add more next year, too. It predicts it will bring in about $100 million in total revenue this year from its "Even More Space" seats, which have more legroom and also allow passengers to get on the plane first.
Looking ahead to the critical Thanksgiving and Christmas travel periods, JetBlue said its bookings are "shaping up nicely." The airline is one of the most vulnerable to swings in consumer demand because it doesn't have as many business travelers as other major airlines.
Shares fell 7 cents, or 1.6 percent, to $4.29 in afternoon trading.
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