Alaska Air Q2 Earnings Surpass Estimates, Decrease Year Over Year

Alaska Air Group, Inc. (ALK) reported second-quarter 2025 earnings of $1.78 per share, which beat the Zacks Consensus Estimate of $1.56 per share but declined 30.2% year over year.

Operating revenues of $3.70 billion surpassed the Zacks Consensus Estimate of $3.65 billion. The top line jumped 27.8% year over year, with passenger revenues accounting for 90.5% of the top line and increasing 27% owing to consistency in air-travel demand.

Passenger revenues totaled $3.35 billion in the reported quarter. On a year-over-year basis, cargo and other revenues of $139 million grew 93%. Loyalty program other revenues grew 21% year over year to $210 million.

Other Details of ALK's Q2 Earnings

All comparisons have been presented on a year-over-year basis unless mentioned otherwise.

Revenue per available seat mile (RASM: a key measure of unit revenues) fell 3.3% to 15.39 cents. Yield decreased 4% to 16.62 cents.

Reflecting the uptick in air-travel demand, consolidated traffic (measured in revenue passenger miles) grew 31.8% to 20.17 billion. To cater to this increased demand, capacity (measured in average seat miles) rose 32.2% to 24.05 billion. Although traffic improved on a year-over-year basis, it failed to outpace capacity expansion. As a result, the load factor (percentage of seats filled by passengers) fell to 83.9% from 84.1% in the prior-year period. Our estimate is pegged at 88.8%.

In the second quarter, total operating expenses (on a reported basis) grew 33% to $3.42 billion.

Economic fuel price per gallon fell 15.8% to $2.39.

Consolidated operating costs per available seat mile (excluding fuel and special items) grew 10.2%.

Liquidity

As of June 30, 2025, Alaska Air had $750 million of cash and cash equivalents compared with $1.04 billion at the end of the prior quarter. ALK exited the second quarter of 2025 with long-term debt (net of current portion) of $4.44 billion compared with $4.29 billion at the end of the prior quarter. Debt-to-capitalization ratio was 60% at the end of the reported quarter.

During the second quarter, ALK repurchased 8.7 million shares for $428 million.

ALK's Outlook

ALK anticipates third-quarter 2025 adjusted earnings per share in the range of $1.00-$1.40. The Zacks Consensus Estimate is currently pegged at $1.55 per share.

For the third quarter of 2025, the company expects available seat miles (a measure of capacity) to be down 1% from the year-ago quarter. RASM is expected to remain flat to up low single digits. For third-quarter 2025, CASM is expected to be up to mid to high single digits.

ALK anticipates 2025 adjusted earnings per share to be more than $3.25. The Zacks Consensus Estimate is currently pegged at $3.33 per share.

For 2025, ALK expects available seat miles (a measure of capacity) to be up 2% from 2024 actuals. RASM is expected to remain flat to up low single digits. For 2025, CASM is expected to be up to mid-single digits.

Currently, ALK carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Q2 Performances of Other Transportation Companies

Delta Air Lines (DAL) reported second-quarter 2025 earnings (excluding $1.17 per share from non-recurring items) of $2.10 per share, which beat the Zacks Consensus Estimate of $2.04. Earnings decreased 11% on a year-over-year basis due to high labor costs.

Revenues in the June-end quarter were $16.65 billion, beating the Zacks Consensus Estimate of $16.2 billion and decreasing marginally on a year-over-year basis. Adjusted operating revenues (excluding third-party refinery sales) increased 1% year over year to $15.5 billion. 

J.B. Hunt Transport Services, Inc. (JBHT) reported second-quarter 2025 earnings of $1.31 per share, which missed the Zacks Consensus Estimate of $1.34 and declined 0.8% year over year.

Total operating revenues of $2.93 billion missed the Zacks Consensus Estimate of $2.94 billion and were flat year over year. JBHT’s second-quarter revenue performance witnessed a 6% increase in Intermodal (JBI) loads, a 13% increase in Truckload (JBT) loads, a 3% increase in Dedicated Contract Services (DCS) productivity and a 6% increase in Integrated Capacity Solutions (ICS) revenue per load. These items were offset by Final Mile Services revenue declining 10%, lower revenue per load in both JBI and JBT, a 9% decrease in ICS load volume and a 3% decline in average trucks in DCS. Total operating revenues, excluding fuel surcharge revenue, increased 1% on a year-over-year basis.

United Airlines Holdings, Inc. (UAL) reported mixed second-quarter 2025 results wherein the company’s earnings beat the Zacks Consensus Estimate, but revenues missed the same.

UAL's second-quarter 2025 adjusted earnings per share of $3.87 surpassed the Zacks Consensus Estimate by a penny but declined 6.5% on a year-over-year basis. The reported figure lies within the guided range of $3.25-$4.25.

Operating revenues of $15.2 billion fell short of the Zacks Consensus Estimate of $15.4 billion but increased 1.7% year over year. Passenger revenues (which accounted for 90.8% of the top line) increased 1.1% year over year to $13.8 billion. UAL flights transported 46,186 passengers in the second quarter, up 4.1% year over year.

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