By Dhirendra Tripathi

Investing.com – American Airlines stock (NASDAQ:) traded 3% higher in Tuesday’s premarket after the carrier said chief executive Doug Parker will step down at the end of March.

Robert Isom will replace him as the president of the company.

Parker gained notoriety for declaring that he had broken the grip on the business cycle of the air travel industry. This argument was used to support a dramatic increase in stock buybacks as well as dividends during the last five year. The company was left without sufficient capital, and the government became dependent when the pandemic of early 2020 struck. 

Isom will also join the airline’s board of directors on the same date, while Parker, who led the airline for 20 years, will continue to serve as chairman.

Isom was named president in 2016. He has over three decades experience in finance, operations planning, marketing sales alliances and revenue management.

Isom is appointed at an opportune moment when industry remains in shock from the pandemic. In the past week, the Omicron virus has threatened to endanger a promising recovery. Many countries including the U.S. have reintroduced restrictions on air travel in response to this discovery, though they are doing so more slowly.

American Airlines reported a profit increase in its third quarter, and stated that it would add more capacity to meet rising demand.

The third quarter profit was $169million, compared with a loss in July and September last year of $2.39 trillion. With the exception of special items, there was a $641 million net loss in third-quarter.

In October, the airline stated that its fourth quarter capacity would be no less than 13% compared to the fourth quarter 2019. According to the airline, fourth-quarter revenues will fall by around 20%.