Alaska Air expects narrower-than-expected losses for Q1 (NYSE:ALK)
Alaska Air (NYSE:ALK) expects narrower-than-expected losses for the first quarter of 2024, the American airline said on Tuesday.
The airline estimates a quarterly adjusted loss per share of $0.55 to $0.45 a share, compared with Wall Street expectations of a loss of $1.18 per share.
The company’s profitability was negatively impacted by at least $150M amid the temporary grounding of the Boeing 737 MAX 9 jet following a midair cabin panel blowout in early January.
The Q1 forecast reflects a partial compensation from Boeing (BA) that the airline received after the incident and an approximately -$0.30 per share remaining impact from the grounding.
Nevertheless, the carrier sees its Q1 performance on track to exceed expectations, driven by strategic network adjustments and strong demand in the quarter.
“Given recent strength in demand through Spring Break travel periods and continued recovery of West Coast business travel, we now expect an even greater year-over-year improvement in Q1 2024 profitability,” Alaska Air (ALK) said in a regulatory filing.
However, full year capacity expectations are still in flux due to uncertainty around the timing of aircraft deliveries as a result of increased Federal Aviation Administration and Department of Justice scrutiny on Boeing and its operations. The carrier sees Q1 capacity (ASMs) to fall around 2.5% versus 2023.
