(Reuters) – Alaska Air raised its fourth-quarter profit forecast on Tuesday, owing to robust travel demand and improved pricing, sending the carrier’s shares up 4.3% in premarket trading.
Excess supply of seats at the beginning of this year’s summer travel season forced airlines to offer discounts to fill their planes, hurting their margins. Since then, U.S. airlines have reduced their capacity and managed to strengthen pricing power.
The Seattle, Washington-based carrier expects its profit per share for the fourth quarter to be between 40 cents and 50 cents, compared with the range of 20 cents to 40 cents forecast earlier.
Alaska Air, which is hosting its 2024 investor day on Tuesday, also forecast its 2025 profit above analysts’ estimate.
Besides, the company expects to benefit from its recently completed acquisition of rival Hawaiian Airlines.
“The combination with Hawaiian gives us the scale to be stronger than either of us could have been on our own – giving guests what they want, where and when they want it,” Alaska Chief Financial Officer Shane Tackett said.
To expand its global presence, Alaska announced new non-stop services to Tokyo, Japan and Seoul, South Korea using Hawaiian’s widebody aircraft.
Alaska Air expects its profit for 2025 to be at least $5.75 per share, compared with analysts’ average expectation of $5.50 per share, according to data compiled by LSEG.
(Reporting by Shivansh Tiwary in Bengaluru; Editing by Shilpi Majumdar)
Comments