United Airlines said Tuesday it is embarking on a $1.5 billion stock buyback as the airline reported higher-than-expected profits for the busy summer travel season and forecast higher airfares through 2025.

Shares of United Airlines rose nearly 13% on Wednesday to lead the way S&P 500 higher and closed at $72.02, the highest since February 2020, before Covid-19 was declared a pandemic. Shares of other airlines also rose sharply, outperforming the overall market.

United said revenue from domestic units rose in August and September compared with a year ago as airlines reduced an oversupply of flights, leading to lower prices.

“We believe first-quarter earnings growth will be possible due to the significant schedule changes and business model changes that continue to be implemented by low-margin airlines,” United Chief Commercial Officer Andrew Nocella said on Wednesday’s earnings call.

United expects to post fourth-quarter adjusted earnings of $2.50 to $3.00 per share, compared with $2.00 per share a year ago and an estimate of $2.00 per share from analysts surveyed by LSEG. $68.

United expanded capacity by 4.1% in the third quarter. The airline said corporate revenue increased 13% in the quarter; Premium revenue, including business class tickets, increased 5%; and sales of basic, no-frills economy tickets increased by 20%. United posted revenue of $14.84 billion, up 2.5% from a year earlier and above analysts’ estimates. Net income was $965 million, down 15% year over year.

Adjusted for one-time items, United reported earnings per share of $3.33, beating Wall Street forecasts and United’s July estimate of $2.75 to $3.25 per share.

Here’s what United reported for the third quarter compared to Wall Street’s expectations, based on average estimates from LSEG:

• Earnings per share: $3.33 adjusted vs. $3.17 expected
• Revenue: $14.84 billion versus expected $14.78 billion

The share buyback would be United’s first since before the Covid-19 pandemic. U.S. airlines received more than $50 billion in government aid during the pandemic-related travel downturn, which banned stock buybacks and dividends, even as airlines still struggled for financial stability.

Southwest Airlines announced a $2.5 billion share repurchase program last month.

“Like other leading airlines and companies, we are embarking on a measured, strategic share repurchase program,” United CEO Scott Kirby said in a note to employees on Tuesday. “I commit to you that investing in our people and our company will always be my top priority, even as we implement this share repurchase program.”

United’s flight attendants union, which has not yet agreed to a new collective bargaining agreement with the company, criticized the airline’s decision to resume buybacks.

In a statement, Sara Nelson, president of the Association of Flight Attendants-CWA, which represents crews at United, Spirit, Alaska and other airlines, said: “The money United just promised Wall Street belongs to the flight attendants who died during the “We have worked during the pandemic during this difficult recovery for all of us on the front lines.”