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Jun 30, 2025
Alaska Air Q2 2025 Earnings Report
Alaska Air Q2 2025 Earnings Report showed solid adjusted EPS and margin improvements despite unit revenue declines.
Key Takeaways
Alaska Air delivered strong Q2 2025 results with adjusted EPS at the high end of guidance, supported by improved Hawaiian operations and a stable cost environment, although unit revenues slightly declined.
Adjusted EPS of $1.78 exceeded guidance, driven by improved Hawaiian operations.
Economic fuel cost per gallon averaged $2.39, aided by moderating crude prices.
Unit costs rose 6.5% due to labor agreements and capacity adjustments.
Unit revenues decreased 0.6% but outperformed industry trends.
Revenue by Segment
Forward Guidance
Management expects improved cost synergies and positive demand momentum, with sequential revenue growth in 2H 2025 despite higher unit costs.
Positive Outlook
- Premium demand expected to remain strong
- Hawaiian operations continue breakeven to profitable trajectory
- Improving industry capacity trends in 2H 2025
- Unit revenues projected to increase sequentially
- Cost synergy trajectory improving in Q4 2025
Challenges Ahead
- Unit costs remain elevated due to labor agreements
- Capacity growth reduced by ~2 points vs prior expectations
- Fuel price volatility expected through peak summer
- Unit cost base less flexible under lower capacity
- Q4 2025 cost results expected higher than prior outlook
Historical Earnings Impact
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Avg. Return Before/After Earnings
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