The airline industry just continues to reel. Yesterday, Houston-based Continental Airlines announced that competition from Delta Air Lines‘s recent broad-based fare cuts is the primary factor behind a revenue decrease that will be at least $50 million more than it originally expected. Last year, Continental reported a net loss of $363 million on revenue of $9.74 billion.
Continental now expects annual revenue to sink by about $200 million instead of its previous estimate of $150 million, according to this SEC filing made yesterday. Although the fare cuts have brought more customers to Continental, the fare cuts are producing less total revenue.
Continental is one of Houston’s largest employers and is generally regarded as one of the healthier legacy U.S. airlines. Nevertheless, it continues to struggle to compete more effectively with lower-cost carriers such as Southwest Airlines.