The company said its fourth-quarter net loss was $340 million, or $1.22 per share, compared with $69 million, or 28 cents per share, a year earlier.

Excluding one-time items, AMR said it lost $214 million, or 77 cents per share, compared with Wall Street forecasts for a loss of 73 cents per share, according to Reuters Estimates.

Special items included a $23 million charge related to aircraft groundings and capacity cuts as well as a noncash pension settlement charge of $103 million.

The airline industry, including AMR, made hefty capacity cuts in the fourth quarter to offset volatile fuel prices and to bolster fares as demand sagged in a weak economy.

AMR said it paid 8 percent more for fuel in the fourth quarter of 2008 than it did in the year-ago period. The company said it expects its mainline capacity to decrease more than 8.5 percent in the first quarter amid economic uncertainty.

The company reported revenue of $5.47 billion, down 3.8 percent.

AMR said it ended the quarter with $3.6 billion in cash and short-tern investments.

(Reporting by Kyle Peterson, editing by Maureen Bavdek)