By Rajesh Kumar Singh and Aatreyee Dasgupta
(Reuters) – Alaska Air Group on Wednesday topped Wall Street estimates for fourth-quarter profit and forecast a smaller-than-expected loss for the current quarter, driven by strong holiday and corporate travel demand as well as improved pricing power. U.S. airlines are reaping the benefits of a significant reduction in domestic seat capacity, which has driven up ticket prices. Alaska, which completed the acquisition of peer Hawaiian in September, cited sustained leisure demand, an uptick in corporate travel, and mild winter weather, for its higher revenue during the holiday quarter. “Overall revenue trends continued to be really, really strong across pretty much the entire network,” Chief Financial Officer Shane Tackett said in an interview. The company, however, expects an adjusted loss of 50 to 70 cents per share in the first quarter, compared with Wall Street’s estimates of a loss of 72 cents per share. Tackett said Alaska has traditionally lost money in the first quarter, but earned all of the profits over the balance of the year. The carrier’s Hawaiian network is also expected to lose money in the March quarter, with a slight profit expected for the balance of the year, he said. The company still expects to deliver a profit per share of more than $5.75 in 2025. Alaska last month said it aims to generate $1 billion in additional profits by 2027 by leveraging its $1.9 billion acquisition of Hawaiian Airlines and booming demand for premium travel. Alaska Air has been ramping up the share of premium seats on its flights and plans to launch a premium credit card as it revamps its loyalty program. “There’s much more upside to come for us,” said Tackett. The Seattle, Washington-based company reported an adjusted profit of 97 cents per share in the fourth quarter compared with analysts’ estimate of 44 cents, according to data compiled by LSEG. Total operating revenue rose 38% to $3.53 billion. Analysts had estimated revenue of $3.43 billion.
(Reporting by Rajesh Kumar Singh in Chicago and Aatreyee Dasgupta in Bengaluru; Editing by Sriraj Kalluvila)
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