Alaska Air Group (ALK) Q1 2025 earnings summary

Executive summary

• Q1 2025 GAAP net loss was $166 million ($1.35 per share), with an adjusted net loss of $95 million ($0.77 per share), reflecting challenging demand and macroeconomic softness; pro forma results improved following the Hawaiian acquisition.

• Integration of Hawaiian Airlines is ahead of plan, with synergy capture, network expansion, and strong performance in premium leisure markets and loyalty growth.

• Ratified new collective bargaining agreements for Alaska and Hawaiian flight attendants; ongoing labor negotiations at Horizon.

• Premium revenues and loyalty programs are outperforming, with premium cabins and card acquisitions showing double-digit growth.

• Generated $459 million in operating cash flow and repurchased $149 million in shares year-to-date.

Financial highlights

• Q1 2025 total revenue was $3.14 billion, up 9% year-over-year on a pro forma basis; unit revenue (RASM) up 5% year-over-year.

• Adjusted loss per share was $0.77, $0.07 below guidance, with industry-leading domestic unit revenue.

• Cargo revenue increased 36% year-over-year, supported by the addition of Amazon A330 freighters.

• Q1 unit costs rose 2.1% year-over-year, mainly due to wage and real estate cost increases.

• Economic fuel cost per gallon was $2.61, down from $3.08 in Q1 2024.

Outlook and guidance

• Q2 2025 capacity expected to grow 2–3% year-over-year, driven by Hawaiian assets; Alaska assets flat.

• Q2 EPS guidance is $1.15–$1.65, with RASM expected flat to down low single digits and CASMex up mid to high single digits.

• Full-year 2025 capacity growth forecasted at 2–3%, with no update to full-year guidance due to economic uncertainty; profitability expected even if revenue remains pressured.

• Cost expectations remain unchanged, with sequential improvement anticipated through the year.

• Ongoing monitoring of demand may lead to further capacity adjustments, especially off-peak.