American Airlines fires EVP due to strategic failures and reduces short-term guidance, signaling a major shift in its operational approach.
The class action centers on allegations that American Airlines and certain of its executives and directors may have committed securities fraud or engaged in other unlawful business practices.
American Airlines recently announced the dismissal of its Executive Vice President and Chief Commercial Officer, Vasu S. Raja, and unexpectedly lowered its short-term guidance. During a conference presentation on May 29, 2024, the company cited several factors for the reduced guidance, including a decline in consumer bookings, an imbalance in domestic supply and demand, and a decrease in capacity growth. American Airlines attributed the drop in bookings to changes in its sales and distribution strategy, coupled with a failure to effectively implement its business strategy, leading to a decision to adjust its approach to win back customers. Consequently, the company slashed its projections for the second quarter of fiscal year 2024, reducing operating margin forecasts by a full percentage point and cutting adjusted earnings per share by over 17%.
Following this news, American Airlines’ stock price dropped by $1.82 per share, or 13.54%, closing at $11.62 per share on May 29, 2024.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is recognized as a leading firm in corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, a pioneer in securities class actions, the firm has been at the forefront of this legal field for over 85 years. Pomerantz remains dedicated to defending the rights of those affected by securities fraud, breaches of fiduciary duty, and corporate misconduct, having secured billions of dollars in damages for class members.