American Airlines' Loss Beats Expectations

Shares of American Airlines parent AMR(AMR) surged Wednesday after the carrier's first-quarter loss was lower than Wall Street expected.

Citing reduced fuel spending and enhanced cost controls, American -- the first airline to report first-quarter earnings -- said it lost $375 million or $1.35 a share. Analysts surveyed by Thomson Reuters had estimated a loss of $1.68. Revenue fell 15% to $4.8 billion. Analysts had estimated $4.7 billion.

Results included the impact of a $13 million charge or 5 cents a share associated with retirements of A300 aircraft during the quarter. A year earlier, American lost $341 million or $1.37 a share in the first quarter.

Shares in American and other carriers, down early in the day, were rising following American's 11 a.m. earnings release. AMR was up 65 cents to $4.87. Delta(DAL) was up 24 cents to $7.24. Southwest(LUV), which will report earnings on Thursday, was up 10 cents to $7.37. Most carriers report next week.

"While lower fuel prices have provided a significant buffer against falling demand in 2009, the struggling economy and capital markets remain significant challenges for American and the rest of the industry," said CEO Gerard Arpey, in a prepared statement. American paid $561 million less for fuel than it would have paid at year-ago prices.

Arpey said the company has cut 2009 capital expenditures by about $100 million, identified ways to help control unit costs and secured financing for planned 737 deliveries into the fourth quarter of 2010.