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Net loss narrowed to USD$138 million, from USD$325 million a year earlier. Revenue rose to USD$8.9 billion from USD$8.5 billion.

United Continental said it had paid USD$3.1 billion for fuel in the quarter, up 26.3 percent from a year earlier. It ended the quarter with USD$8.3 billion in unrestricted cash, cash equivalents and short-term investments and undrawn lines of credit. United said they benefited from higher fares during the quarter.

For United Continental, the results speak well of the company's post-merger performance, Maxim Group analyst Ray Neidl wrote in a research note. "Our take is that the quarter was good and the merger results continue to pay off," Neidl said. "We believe there is much further upside potential from the merger. However, short-term challenges remain with integration, especially the combination of unions."

Despite the renewed industry stability, airlines face high fuel costs and economic troubles that could still disrupt the industry recovery, given their potential ripple effects on travel demand from businesses and consumers. The profits, reported yesterday, follow those in recent days by Delta Air Lines, US Airways and Southwest Airlines. Major carriers say travel demand has held up well in recent months despite concerns that economic weakness could be a drag. (Airwise)