Alaska Air (ALK) 1Q 2025 earnings

Alaska Airlines on Wednesday warned that softer travel demand will eat into earnings in the second quarter, the latest in a chorus of carriers seeing weaker-than-expected bookings.

Alaska said bookings have stabilized but forecast a six-percentage-point headwind due to “softer demand.”

The carrier, which merged with Hawaiian Airlines last year, said it expects second-quarter unit revenue to be flat to down as much as 6% over a year ago and anticipates adjusted earnings per share of $1.15 to $1.65, lower than the $2.47 a share Wall Street analysts had forecast.

The airline said it wouldn’t update its full-year guidance, citing “economic uncertainty and volatility,” but said it still expects to be profitable even if revenue is under pressure in the second half of the year.

Alaska’s unit revenue rose 5% in the first quarter from last year, better than larger rivals’ domestic unit sales. Chief Financial Officer Shane Tackett said customers are still booking trips but at lower-than-expected fares.

“The fares aren’t as strong as they were in the fourth quarter of last year and coming into January and first part of February,” he said in an interview Wednesday. “Demand is still quite high for the industry, it’s just not at the peak that we all anticipated might continue coming out of last year.” 

“Alaska is built for times like these with our relentless focus on safety, care and performance,” CEO Ben Minicucci said in an earnings release. “Amid the economic uncertainty, our teams controlled what they can control and delivered results that strengthen our foundation for the long term.”

Here is how Alaska performed in the first quarter compared with Wall Street expectations, according to consensus estimates from LSEG:

• Loss per share: 77 cents adjusted vs. an expected loss of 75 cents
• Revenue: $3.14 billion vs. $3.17 billion expected

In the first quarter, Alaska posted a net loss of $166 million, down from a loss of $132 million a year ago, and revenue of more than $3.1 billion, which was up 41% from a year ago and shy of analysts’ forecasts.

Adjusting for one-time items, Alaska reported a loss of 77 cents per share for the three months that ended March 31, below analysts’ estimates.