Well yes but that's primarily due to their hubs and AA's self-imposed lack of widebodies due to the premature retirements during COVID - I would also note AA's fleet in their 2023 filings was 952 vs Delta's 947 so not much of a gap anymore.

Delta's TRASM in Q1 2024 was 20.98 vs American and United at 17.83 and 17.50 respectively. I don't think many would say American receives a revenue premium over United (which makes up for it in other quarters w/ its international network). Delta admits its profitability is driven by its 4 core hubs it serves most: ATL, MSP, DTW, and SLC - fortress hubs where they enjoy 70%+ share.

In comparison, AA is systematically poorly positioned:

1. Midwest hub is Chicago dominated by Southwest at MDW and United leading at ORD - if they leave ORD then United will dominate, and building a 2nd hub is tough since all the markets here are stagnant / in decline. Maybe they can look to build a secondary hub in the region?

2. LAX is the West hub which is a bloodbath for all - Delta noted in their investor presentation they don't plan to boost domestic capacity at LAX (and BOS) in 2024 to focus on its core hubs for better profitability and cost structures. Combined with them cutting (LHR, PVG) or reducing frequencies (CDG, SYD, AKL) for every long-haul LAX route sans Tahiti (~50% LF), safe to assume they're not killing it. SEA for Delta is the lowest-performing domestic hub in the US for any airline and dominated by Alaska - there may be an opportunity to replicate a NEA type agreement in SEA under a different admin

3. PHX in the Rockies / Western SunBelt - very competitive w/ Southwest. You could argue AA needs to invest more here while Southwest has the Boeing issues

4. DCA is very profitable but its potential is limited due to perimeter and slot restrictions - LGA and JFK are again very competitive (former again w/ perimeter & slot restrictions) - it took Delta a long time to become profitable in New York so it will require AA to invest in expanding terminal 8 at JFK ($$). Unsure the path forward at LGA but they can't leave otherwise Delta will dominate

5. MIA drives LATAM but is terribly positioned for domestic flying - imo they should invest more in MIA international routes (esp. to Europe) and increase frequency to LATAM further

That leaves DFW (major profit center), CLT (major profit center), and PHL which is their best-performing East Coast hub but has to rely on connecting traffic due to its location: it's the 4th most important city in the Northeast Corridor which limits its local catchment albeit it still deserves a Flagship Lounge. Combine that w/ their debt problem and that their credit card agreement is w/ Citi (less reach than Amex or Chase), it's hard to see a path forward to catch up to Delta sans demographic shifts (that will help their Sunbelt hubs) or upheaval in the US markets. Investing in New York and LAX will be low-margin and will not serve their problem, but they can't pull back.

Internationally there are missed opportunities especially with their Atlantic JV and South Pacific JV - Asia is a problem since the JAL JV is HND is slot restricted and NRT has lost significance. AA needs to work better w/ Qantas and dominate Aus/NZ in the US - they lead but the fact that it is competitive among the Big 3 is a failure. If you are willing to burn $ to crowd others out, this should be one. They should help IAG with the rumored TAP Air Portugal acquisition and need to further dominate LHR (lead but it's competitive), collab w/ Aer Lingus and Iberia to dominate in Ireland and Madrid, and perhaps invest / work with Iberia to build and dominate Barcelona. AA does not dominate in IAG's markets the way Star dominates in Lufthansa's markets or SkyTeam dominates in Air France and KLM's markets which is another missed opportunity.

So agree with the lack of strategy, but domestic looks tough - international can be built further but w/o widebodies you'll have to wait and will require $$ that they don't have. It's a bad spot.