Alaska Air has pulled its full-year financial forecast, citing recent economic uncertainty and volatility. In addition to drawing back guidance for the year, the Seattle-based carrier also forecast a lower-than-expected profit for the current quarter due to softening travel demand.
The company expects earnings during the second quarter of the year to be pressured, with revenue projected to take a six-percentage-point hit. While overall bookings have stabilised, demand weakness is weighing on near-term performance.
For the quarter ending June, capacity measured in available seat miles (ASMs) is forecast to rise between 2-3% compared to the year prior. Revenue per available seat mile (RASM) is expected to be flat to down in the low single digits, while cost per available seat mile excluding fuel (CASMex) is projected to rise in the mid to high single digits.
Adjusted earnings per share are forecast to range between $1.15 and $1.65. The company reiterated that the second quarter will face the most significant cost pressure this year, with unit costs expected to ease in the second half.
On an earnings call for the company’s first quarter, it was noted that April is shaping up to be a “stronger month”, while May and June are expected to be slightly softer.
“Alaska is built for times like these with our relentless focus on safety, care and performance,” said CEO Ben Minicucci. “Amid the economic uncertainty, our teams controlled what they can control and delivered results that strengthen our foundation for the long term.”
Alaska's net loss for the first quarter of 2025 was $95 million, or $0.77 per share, including Hawaiian results. In comparison, the airline reported a net loss of $116 million, or $0.92 per share, for the same quarter of the year prior.
The company recorded revenue growth during the first three-month period of the year, reporting a 41% increase in total operating revenue, which reached $3.14bn, compared to $2.23bn for the same period last year. Passenger revenue rose 40% on the same period of the year prior to $2.81bn.
In addition, the airline saw an uptick in its loyalty program and other revenue, which grew 26% to $207 million in the first quarter of 2025.
In terms of capital management, the airline repurchased 1.8 million shares of common stock for approximately $107 million in the first quarter. Total repurchases stand at $149 million as of April 22, 2025.
Operating cash flow for the first quarter totalled $459 million, and the company held $2.5bn in unrestricted cash and marketable securities as of March 31, 2025.
Operationally during the quarter, Alaska Air Group expanded its combined fleet by eight aircraft, which included the addition of four 737 MAX 9s, one 787-9, one Embraer E175, and two A330-300 freighters from Amazon Air.
Additionally, the company noted further growth at its San Diego hub, introducing three new routes to Phoenix, Chicago and Denver.
Looking ahead, Alaska Air said that it will evaluate off-peak capacity adjustments in the third and fourth quarters, while continuing to monitor the demand environment.