Alaska Air increases first-quarter loss forecast on fuel
The carrier expects a loss of up to two dollars per share as fuel costs rise and regional demand slows. Corporate bookings remain a key positive factor.
Alaska Air Group, Inc. has revised its first-quarter earnings guidance, signaling a larger-than-expected loss as the airline industry grapples with a sharp rise in fuel expenses and regional travel disruptions. The carrier now anticipates an adjusted loss of $1.50 to $2.00 per share, compared to its earlier forecast of $0.50 to $1.50 per share. Following the announcement, shares of the company declined 1.1% in premarket trading.
The primary driver behind the revised outlook is the recent surge in energy prices linked to the conflict involving Iran. This geopolitical instability has caused Brent Crude Oil to soar by approximately 58% this month, marking the steepest monthly jump in data dating back to 1988. Alaska Air expects its economic fuel prices to average between $2.90 and $3.00 per gallon, creating a negative impact on earnings per share of at least $0.70.
