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Why Is Alaska Air (ALK) Down 12.6% Since Last Earnings Report?
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A month has gone by since the last earnings report for Alaska Air Group (ALK - Free Report) . Shares have lost about 12.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Alaska Air due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important drivers.
Alaska Air Incurs Loss in Q1
Alaska Air reported a wider-than-expected loss in the first-quarter of 2026. Revenues edged past the Zacks Consensus Estimate. The company reported a loss of $1.68 per share, wider than the Zacks Consensus Estimate of a loss of $1.61. In the year-ago quarter, ALK reported a loss of 77 cents per share.
Meanwhile, the operating revenues of $3.30 billion beat the Zacks Consensus Estimate of $3.27 billion. Total revenues jumped 5.2% year over year, with passenger revenues accounting for 88.5% of the top line and increasing 4% to $2.92 billion.
On a year-over-year basis, cargo and other revenues increased 25% year over year to $153 million, beating our estimate of $128.4 million. Loyalty program other revenues grew 10% year over year to $227 million, surpassing our estimate of $209.5 million.
Alaska Air’s diversified revenue base contributed to the top-line year-over-year growth. Corporate travel increased 19% and premium revenues grew 8%.
Other Details of ALK’s Q1 Earnings
All comparisons are presented on a year-over-year basis unless otherwise noted.
Revenue per available seat mile (RASM: a key measure of unit revenues) inched up 3.5% to 15.30 cents. Yield increased 3.7% to 16.88 cents.
Consolidated traffic (measured in revenue passenger miles) inched up 0.2% to 17.30 billion. Capacity (measured in available seat miles) rose 1.7% to 21.57 billion. Load factor (percentage of seats filled by passengers) fell to 80.2% from 81.3% in the prior-year period. Our estimate for the metric was 89.2%. In the first quarter, total operating expenses (on a reported basis) increased 7% to $3.58 billion.
Economic fuel price per gallon increased 14.2% to $2.98. Consolidated operating costs per available seat mile (excluding fuel and special items) inched up 6.3%.
Liquidity & Share Buybacks
At the end of the March quarter, ALK had $451 million in cash and cash equivalents compared with $627 million at the end of 2025. ALK exited the first quarter of 2026 with long-term debt (net of current portion) of $4.82 billion compared with $4.83 billion at the end of the prior quarter.
During the first quarter, ALK repurchased 4.7 million shares for $203 million, with year-to-date repurchases totaling $250 million as of April 20, 2026.
ALK’s Outlook
ALK anticipates a second-quarter 2026 adjusted loss per share of $1. Capacity in the June quarter is projected to be up 1% year over year, down nearly a point from original expectations, reflecting proactive capacity trimming in May and June.
The adjusted tax rate is estimated to be 32%. Unit cost in the June quarter is anticipated to be approximately 1.5 points higher than the first quarter, driven by close-in capacity reductions and several transitory factors. ALK suspended its guidance for full-year 2026 due to fuel volatility
Alaska Air incurred a loss of 82 cents per share (excluding $1.05 from non-recurring items) in the first quarter of 2020, narrower than the Zacks Consensus Estimate of a loss of $1.27. In the year-ago quarter, the company reported earnings of 17 cents. The downturn is due to unprecedented drop in air travel demand in the wake of the coronavirus outbreak. Having started in February, the downfall aggravated in March, with cancellations exceeding bookings. Demand is around 90% below the normal level. Revenues came in at $1,636 million, missing the Zacks Consensus Estimate of $1,691.1 million. The top line also declined approximately 13% year over year. Passenger revenues — contributing 90.5% to the top line — were down 14% on a year-over-year basis.
Operating Statistics Consolidated traffic, measured in revenue passenger miles, declined 14.4% year over year in the reported quarter. Capacity (measured in available seat miles) dropped 1.3%. Load factor (percentage of seats occupied by passengers) deteriorated 1,070 basis points to 69.6% as traffic declined more than the amount of capacity contraction.
Total revenue per available seat mile (RASM: a key measure of unit revenues) fell 11.7% year over year to 10.69 cents in the quarter under discussion. Meanwhile, yield inched up 0.9% to 13.9 cents. Operating Expenses & Income In the first quarter, total operating expenses (on a reported basis) were up 6% year over year to $1,957 million, with expenses on wages and benefits increasing 10%. Fuel price (economic) was $1.93 per gallon, down 9.4% year over year. The company reported operating loss of $321 million in the first quarter against operating income of $25 million in the year-ago quarter. Consolidated cost per available seat mile — excluding fuel and special items — inched up 1.8% to 9.22 cents. Liquidity At the end of the first quarter, this Seattle, WA-based company had $2,125 million in cash and marketable securities compared with $1,521 million at the end of 2019. The company exited the quarter with long-term debt of $1,203 million compared with $1,264 million at the end of 2019. Adjusted debt-to-capitalization ratio was 48% compared with 41% at the end of December 2019.
Airline traffic, measured in revenue passenger miles, rose 44.2% year over year to 13,554 million in the reported quarter. Capacity or available seat miles increased 41.1% to 15,612 million. Load factor (percentage of seats filled by passengers) increased 190 basis points to 86.8% owing to traffic growth outpacing capacity expansion.
Passenger revenue per available seat mile (PRASM: a key measure of unit revenues) increased 1.3% year over year to 11.57 cents. While total revenue per available seat mile (RASM) declined 0.4% to 13.46 cents in the reported quarter, yield declined 0.8% to 13.33 cents.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -1823.53% due to these changes.
VGM Scores
At this time, Alaska Air has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock has a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Alaska Air has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Alaska Air (ALK) Down 12.6% Since Last Earnings Report?
A month has gone by since the last earnings report for Alaska Air Group (ALK - Free Report) . Shares have lost about 12.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Alaska Air due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important drivers.
Alaska Air Incurs Loss in Q1
Alaska Air reported a wider-than-expected loss in the first-quarter of 2026. Revenues edged past the Zacks Consensus Estimate. The company reported a loss of $1.68 per share, wider than the Zacks Consensus Estimate of a loss of $1.61. In the year-ago quarter, ALK reported a loss of 77 cents per share.
Meanwhile, the operating revenues of $3.30 billion beat the Zacks Consensus Estimate of $3.27 billion. Total revenues jumped 5.2% year over year, with passenger revenues accounting for 88.5% of the top line and increasing 4% to $2.92 billion.
On a year-over-year basis, cargo and other revenues increased 25% year over year to $153 million, beating our estimate of $128.4 million. Loyalty program other revenues grew 10% year over year to $227 million, surpassing our estimate of $209.5 million.
Alaska Air’s diversified revenue base contributed to the top-line year-over-year growth. Corporate travel increased 19% and premium revenues grew 8%.
Other Details of ALK’s Q1 Earnings
All comparisons are presented on a year-over-year basis unless otherwise noted.
Revenue per available seat mile (RASM: a key measure of unit revenues) inched up 3.5% to 15.30 cents. Yield increased 3.7% to 16.88 cents.
Consolidated traffic (measured in revenue passenger miles) inched up 0.2% to 17.30 billion. Capacity (measured in available seat miles) rose 1.7% to 21.57 billion. Load factor (percentage of seats filled by passengers) fell to 80.2% from 81.3% in the prior-year period. Our estimate for the metric was 89.2%. In the first quarter, total operating expenses (on a reported basis) increased 7% to $3.58 billion.
Economic fuel price per gallon increased 14.2% to $2.98. Consolidated operating costs per available seat mile (excluding fuel and special items) inched up 6.3%.
Liquidity & Share Buybacks
At the end of the March quarter, ALK had $451 million in cash and cash equivalents compared with $627 million at the end of 2025. ALK exited the first quarter of 2026 with long-term debt (net of current portion) of $4.82 billion compared with $4.83 billion at the end of the prior quarter.
During the first quarter, ALK repurchased 4.7 million shares for $203 million, with year-to-date repurchases totaling $250 million as of April 20, 2026.
ALK’s Outlook
ALK anticipates a second-quarter 2026 adjusted loss per share of $1. Capacity in the June quarter is projected to be up 1% year over year, down nearly a point from original expectations, reflecting proactive capacity trimming in May and June.
The adjusted tax rate is estimated to be 32%. Unit cost in the June quarter is anticipated to be approximately 1.5 points higher than the first quarter, driven by close-in capacity reductions and several transitory factors. ALK suspended its guidance for full-year 2026 due to fuel volatility
Having started in February, the downfall aggravated in March, with cancellations exceeding bookings. Demand is around 90% below the normal level.
Revenues came in at $1,636 million, missing the Zacks Consensus Estimate of $1,691.1 million. The top line also declined approximately 13% year over year. Passenger revenues — contributing 90.5% to the top line — were down 14% on a year-over-year basis.
Operating Statistics
Consolidated traffic, measured in revenue passenger miles, declined 14.4% year over year in the reported quarter. Capacity (measured in available seat miles) dropped 1.3%. Load factor (percentage of seats occupied by passengers) deteriorated 1,070 basis points to 69.6% as traffic declined more than the amount of capacity contraction.
Total revenue per available seat mile (RASM: a key measure of unit revenues) fell 11.7% year over year to 10.69 cents in the quarter under discussion. Meanwhile, yield inched up 0.9% to 13.9 cents.
Operating Expenses & Income
In the first quarter, total operating expenses (on a reported basis) were up 6% year over year to $1,957 million, with expenses on wages and benefits increasing 10%. Fuel price (economic) was $1.93 per gallon, down 9.4% year over year.
The company reported operating loss of $321 million in the first quarter against operating income of $25 million in the year-ago quarter. Consolidated cost per available seat mile — excluding fuel and special items — inched up 1.8% to 9.22 cents.
Liquidity
At the end of the first quarter, this Seattle, WA-based company had $2,125 million in cash and marketable securities compared with $1,521 million at the end of 2019.
The company exited the quarter with long-term debt of $1,203 million compared with $1,264 million at the end of 2019. Adjusted debt-to-capitalization ratio was 48% compared with 41% at the end of December 2019.
Airline traffic, measured in revenue passenger miles, rose 44.2% year over year to 13,554 million in the reported quarter. Capacity or available seat miles increased 41.1% to 15,612 million. Load factor (percentage of seats filled by passengers) increased 190 basis points to 86.8% owing to traffic growth outpacing capacity expansion.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -1823.53% due to these changes.
VGM Scores
At this time, Alaska Air has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock has a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Alaska Air has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.