American Airlines slashes $10B in debt—here’s how it plans to keep cutting
American Airlines Group Inc. (AAL) has made steady progress in cutting its debt over the past four years. The company’s total obligations have dropped from around $46 billion in 2021 to approximately $36 billion by the third quarter of 2025. Despite concerns about a possible economic slowdown, analysts remain optimistic about its financial strategy and growth potential.
AAL’s debt reduction plan remains a key focus, with the airline aiming to refine its capital structure further. Management expects modest revenue growth of around 1% even in a challenging economic climate. The company’s efforts to premiumise its fleet and improve margins are designed to boost free cash flow, supporting ongoing debt reduction.
AAL’s debt has fallen by $10 billion since 2021, with further reductions planned. The combination of fleet upgrades, margin improvements, and institutional backing positions the airline for stronger cash generation. If market multiples expand as expected, the company’s valuation could see upward momentum in the coming months.
