May 29 (UPI) -- The stock value of American Airlines on Wednesday took a 15% hit as it was announced the airline will be cutting its growth capacity in the second half of the year, among a series of changes that include the departure of American's chief commercial officer.
"We know we've dug ourselves a hole in this second quarter, and our operating earnings are going to be off by a couple of hundred million dollars," American Airlines' CEO Robert Isom said Wednesday at the 40th annual Bernstein Strategic Decisions Conference.
American is trying to keep on par with its rival airlines, like United and Delta. American Airlines announced in February its first-ever non-stop flight between Texas and Brisbane, Australia with October plans to begin.
"We've got a lot of work to do to recoup that," Isom said.
The day before on Tuesday, American Airlines confirmed that Vasu Raja, the company's chief commercial officer, will leave the company next month in a job he has kept since April 2022 as the company has underperformed its rival airlines.
"I've known Vasu for a long time," Isom said Wednesday.
Raja is widely viewed as a driving reason behind the company's slow financial decline after a series of changes that were seen as failures, including gunning for direct ticket sales rather than using third parties as the airline cut its sales workforce.
"I admire his creative thinking, his passion, he is an innovator and a disruptor," Isom commented about Raja. "He's a good friend. But sometimes, we need to reset, and in this case, we do."
Stephen Johnson, American Airlines' vice chairman and chief strategy officer, will temporarily assume Raja's job while leading a search for a permanent replacement.
Other airline carries, such as United, Delta and Southwest also saw stock prices slip between 1-4 points.
