American parent AMR Corp (AAMRQ.PK) is also looking to generate $3 billion in financial improvements by 2017, including cost cuts and revenue growth, it told employees in a memo on Monday.

To reach $1 billion in revenue improvement, its goals include boosting international flying to 44 percent of business by 2017 from 38 percent currently. Domestic flying would drop to a 56 percent share in five years.

International travel tends to be more lucrative for airlines.

The airline also said that bolstering its ability to do certain domestic codeshares would help expand the reach of its network. Under code-sharing agreements, an airline sells seats on another carrier's flights as if they were its own.

"There are cities we simply cannot effectively service because of airport constraints, or because we cannot operate the route profitably on our own," the staff memo said, citing the example New York's crowded John F. Kennedy airport as an example.

Texas-based American also said revenue gains could be attained with the use of large regional jets and small narrowbody planes, such as the Airbus A319, that could help it better match supply with demand in some markets.

AMR filed for bankruptcy in November. Three labor unions at the carrier have called on the company to support a possible merger with US Airways (LCC.N), saying a combination of the two will save jobs and aid both carriers' networks.

AMR management has said it wants to exit Chapter 11 as a stand-alone carrier.

American's memo also cited progress in operations. It said unit revenue, an important airline measure, rose 10.3 percent in the first quarter, and added that the company has renewed or won more corporate accounts since the Chapter 11 filing.

(Reporting By Karen Jacobs; Editing by Tim Dobbyn)

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