Alaska Air Group (ALK) investor relations material

Strategy and integration

• Alaska Accelerate shifts from cost leadership, scale and low fares toward commercial leadership, differentiated revenue and loyalty, while retaining a relative cost advantage.

• Hawaiian Airlines accelerated scale, global reach, premium products and cargo; integration advances through combined operating certificates and a unified loyalty platform.

• Roadmap: build the foundation in 2024–25, activate growth in 2026–28, then scale and harvest value in 2029–30.

• Two-thirds of the $1B incremental profit target has been achieved, with full delivery targeted for 2027.

Financial outlook and capital priorities

• 2030 targets include over 60% diversified revenue, premium revenue above 40%, loyalty cash near $4B and cargo revenue near $750M.

• 2027 EPS potential exceeds $10 at $2.50/gal fuel; at $3.25/gal fuel, EPS potential is $5–$6.

• Long-term targets include 11–13% pretax margins, EPS above $10, double-digit ROIC and ~1.5x net leverage; earnings recovery is expected to support rapid deleveraging.

• Fleet plan supports ~4% annual capacity growth; CapEx is $1.9B in 2026, $1.6B in 2027 and ~$1.7B annually in 2028–30.

• Fuel is the largest near-term earnings headwind; a multi-year West Coast fuel strategy offers up to 1 point of long-term margin opportunity.

West Coast growth and international network

• Seattle targets 15 long-haul routes and the #1 Seattle international carrier position by 2030; long-haul flying is planned to reach 15% of ASMs, up 7 points vs. 2026.

• Seattle growth levers include more gauge and frequency, Paine Field scale, optimized hub flows and long-haul growth; the plan targets at least 8 points of incremental Seattle metro local share by 2030.

• Planned Atlantic and Pacific joint businesses, alongside a renewed American Airlines agreement, are intended to broaden partner demand and strengthen the international proposition.

• Portland seats grew 1.3x and flow traffic 5x in 1H26 vs. 1H23; local O&D share rose 5 points, active loyalty members increased 12% vs. 2024, and margin was 1 point above system in 1H26.

• San Diego targets over 5 points of share growth by 2030 through mainline gauge, oneworld reach, premium investments and loyalty; 2027 is expected to be less exposed to new-market ASMs.