I think the number of employees is probably the main reason the route isn't doing so well. While a profit of 8.5M or 10.0M / year might sound like a lot of money, it really isn't. $10M US comes out to about $27,000/day, or $13,500/flight. Now consider the overhead -- 100 *very* senior employees, flight crews, lease payments, gate space, fuel and everything else. It's got to be a VERY low ROI route.
If AA were to start a new route to TLV, they could probably do it quite well with under 20 people in all of Israel. The burdened cost of those 80 employees is probably at least $4M, which would represent an immediate 40% increase in ROI -- not a bad deal.
Keeping 100 senior employees in place for a single flight a day is, at least to me, a great example of why TWA was doing so poorly.
That said, I hope AA does have service -- I'd love to be able to fly AA nonstop to TLV, and use my miles to send other people there...