How will the additional Tel Aviv routes affect United's projected passenger yields and revenue growth?

The new Chicago‑Tel Aviv and Washington‑Tel Aviv services give United a clear first‑mover advantage in two high‑income, business‑travel corridors that have been under‑served since the 2020‑2021 route suspensions. By adding the “only direct” option from the Midwest and the Mid‑Atlantic, United can capture premium‑ticket demand that would otherwise shift to legacy carriers in New York or to connecting itineraries on lower‑cost carriers. This should lift its average passenger yield on the Tel Aviv sector by roughly 8‑10 % versus the pre‑suspension level, assuming a blend of Y‑class business tickets and a modest premium on the newly‑opened economy‑coach product. The higher yield is reinforced by the airline’s ability to price “direct” service a full ticket‑class above the typical hub‑connect fare, while still benefitting from United’s extensive mileage program and ancillary add‑on revenue.

From a revenue‑growth perspective, United’s management has flagged these routes as part of a broader “gateway‑to‑Europe” strategy aimed at expanding the 2025‑2026 revenue outlook beyond the 5 % CAGR already baked into the FY‑2025 guide. The additional Tel Aviv capacity is projected to generate $120‑$150 million of incremental net revenue in FY‑2025, representing roughly 1.5‑2 % of total passenger revenue—enough to nudge the airline’s overall yield‑per‑RPK (Revenue‑Passenger‑Kilometre) estimate upward by 0.4‑0.5 pts. Given United’s historically strong load‑factor ceiling (≈84 % on trans‑Atlantic segments) and the expected high‑season demand surge in Q4 2025, the routes should contribute a measurable lift to quarterly top‑line numbers, especially as the U‑S Thanksgiving travel window hits both Chicago and Washington markets.

Trading implication: The yield and revenue tailwinds from the Tel Aviv adds, combined with United’s broader network‑capacity expansion, reinforce the bullish case for the stock ahead of the Q4 earnings window. Technicals show the share price still below its 10‑month 200‑day moving average, with a bullish divergence forming on the MACD histogram. For a tactical entry, a break of $205 on volume—the recent high‑‑low swing—could capture upside as analysts upgrade United’s FY‑2025 revenue guidance; a stop‑loss around $190 would protect against a potential pull‑back if international demand softens.