Alaska Airlines’ Boeing 737 Max 9 plane is sitting at the gate of Seattle-Tacoma International Airport in Seattle, Washington on January 6, 2024.
Stephen Brush | Bloomberg | Getty Images
Alaska Airlines On Wednesday, he warned that softer travel demand would dig into revenue in the second quarter.
Alaska said bookings are stable but predicted a 6% point headwind due to “softer demand.”
Carrier, which merged with Hawaiian Airlines last year, expects second quarter unit revenue to fall from 6% more than a year ago, with an adjusted $1.15 to $1.65, between $1.15 and $1.65, with Wall Street analysts expecting it to be below $2.47.
The airline said it would not update its full-year guidance, citing “economic uncertainty and volatility,” but it said it expects profitability to be high even if revenues are under pressure later in the year.
Alaska’s unit revenues rose 5% in the first quarter from last year. CFO ShaneTucket said customers are still booking trips but are booking at lower fares than expected.
“Freight is the fourth quarter of last year and isn’t as strong as it came in the first part of January and February,” he said in an interview Wednesday. “Demand remains very high for the industry, but last year, it’s not the peak we all expected.”
“Alaska is built for such a time with a merciless focus on safety, care and performance,” CEO Ben Minicicic said in a revenue release. “In the midst of economic uncertainty, our team controlled the outcomes that strengthen our foundation over the long term and what we could deliver.”
According to LSEG consensus estimates, how Alaska worked in the first quarter compared to Wall Street expectations:
Loss per share: Expected revenue for 77 cents adjusted vs 75 cents loss: $3,140 million vs 3,170 million
In the first quarter, Alaska posted a net loss of $166 million, with revenues exceeding $3.1 billion from a loss of $132 million the previous year.
Alaska adjusted for one-off items to report a loss of one share per share for the three months ended March 31st, below analyst estimates.
Alaska will call analysts at 11:30am on Thursday to discuss results and outlook.
