A JetBlue Airlines commercial aircraft flies over Washington as it approaches to land at Dulles International Airport, as seen from Washington, U.S., August 5, 2024. REUTERS/ Umit Bektas/ File Photo

(Reuters) -JetBlue Airways said on Thursday it expects a smaller decline in its third-quarter operating revenue than it anticipated earlier, citing strong demand for air travel through the summer and Labor Day holiday.

It now expects operating revenue per available seat mile to be down 1.5% to 4%, compared with a drop of 2% to 6% forecast earlier.

"For the fourth quarter, while it is early in the booking curve, JetBlue remains encouraged that current trends may carry forward through year-end," the company said.

In April, several major U.S. airlines withdrew their 2025 forecasts, citing uncertainty from tariffs and federal spending cuts that threatened travel demand.

JetBlue reported a smaller-than-expected quarterly loss in July, helped by recovering travel demand and cost-cutting measures, but it stopped short of reinstating its 2025 earnings outlook, citing limited visibility.

The airline reduced its outlook for third-quarter fuel expenses to between $2.45 and $2.55 per gallon, compared with a range of $2.50 to $2.65 forecast previously.

It also narrowed forecast for third-quarter available seat miles, or seating capacity, to be between flat and up 1%, compared with a drop of 1% to up 2% expected previously.

(Reporting by Aishwarya Jain in Bengaluru; Editing by Leroy Leo)