United Airlines takes a shot at Delta's IT meltdown: 'Healthy businesses don't make excuses'
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- United Airlines did not mention the cost of July's CrowdStrike IT outage in its earnings report.
- The incident especially affected Delta, which canceled thousands of flights.
- United executives took a subtle jab at Delta by highlighting their "no excuses" philosophy.
United Airlines reported its earnings on Tuesday, but conspicuously missing was any mention of the financial impact caused by July's catastrophic CrowdStrike IT outage that briefly crippled the airline industry.
An executive also took a not-so-subtle jab at rival Delta Air Lines.
"Healthy businesses don't make excuses about CrowdStrike, don't make excuses about weather," CFO Mike Leskinen said on the company's Wednesday earnings call.
"We build into our guidance the expectation there will be one act of God in a quarter that impacts the business in a negative way. And if that impact ends up not being so large, then we can come at the high end or beat out guidance," he continued.
Delta was much more affected by the outage than other airlines, canceling nearly 7,000 flights and taking several days to resume full operations. It's now seeking compensation from Crowdstrike for some $380 million in extra costs.
(The Texas-based IT firm has said Delta is to blame for the travel mess.)
United, which canceled more than 1,500 flights in the wake of the outage, noted a 1-point reduction in capacity due to the operational disruption but did not attach any financial figures. The carrier reported earnings of $3.33 per share for the quarter compared to Delta's $1.50.
The earnings, higher than what analysts had expected, along with a $1.5 billion stock buyback plan, helped push United's shares up more than 12% in trading Wednesday.
A Delta spokesperson declined to comment.
'No excuses' is at the core of United's philosophy
CEO Scott Kirby said United's "no excuses" ideology stems from his days as a cadet at the United States Air Force Academy.
"The best thing I learned was 'no excuses, ma'am, no excuses, sir,'" Kirby said on the call. "It's easy to point to the things that aren't your fault, that don't feel like they're your fault."
When things go wrong, it's easy to have someone add up how much an event out of your control costs the airline and use that as an excuse to lean on, Kirby explained.
"If you have a no excuses mantra and you don't allow people to even go calculate those numbers, it forces people to go find innovation," he said. "It forces us to do things we would otherwise do if we let ourselves just look at the calendar or look at the bad things that happen and write those off."
Despite the no-excuses philosophy, United has certainly blamed operational meltdowns in its recent history on forces beyond its control.
For example, it attributed a 1.5-point impact on its unit costs from lost capacity due to severe weather in the New York area in June of 2023.