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The tariff-induced uncertainty continued to distort the earnings picture of airlines in the first quarter of 2025. With airline players like American Airlines AAL, Alaska Air Group ALK, Southwest Airlines LUV, JetBlue Airways JBLU and SkyWest SKYW reporting results in the past week, the pain was well-reflected in the reports. The uncertainty also caused airlines like American Airlines to withdraw full-year 2025 projections.
Southwest Airlines also did not reaffirm its guidance for earnings before interest and taxes for 2025 and 2026. Southwest Airlines’ management stated that “Amid the current macroeconomic uncertainty, it is difficult to forecast given recent and short-lived booking trends.”
Read the last Airline Roundup here.
Recap of the Most Recent Important Stories
1. American Airlines’ first-quarter 2025 loss (excluding 13 cents from non-recurring items) of 59 cents per share was narrower than the Zacks Consensus Estimate of a loss of 69 cents. In the year-ago quarter, AAL had reported a loss of 34 cents per share. Operating revenues of $12.55 billion edged past the Zacks Consensus Estimate of $12.52 billion but decreased 0.2% year over year.
Passenger revenues, accounting for 90.8% of the top line, decreased 0.6% year over year to $11.4 billion. Passenger revenues were hurt by a slowdown in domestic leisure demand due to tariff woes. AAL expects earnings per share to be between 50 cents and $1 in the second quarter of 2025.
2. Southwest Airlines reported first-quarter 2025 loss of 13 cents per share, which was narrower than the Zacks Consensus Estimate of a loss of 18 cents. In the year-ago quarter, the company had incurred a loss of 36 cents per share.
Revenues of $6.42 billion beat the Zacks Consensus Estimate of $6.40 billion. The top line, however, improved 1.6% year over year. For second-quarter 2025, management expects available seat miles (a measure of capacity) to improve 1-2% from the year-ago reported figure.
LUV currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
3. Alaska Air reported first-quarter 2025 loss of 77 cents per share, wider than the Zacks Consensus Estimate of a loss of 72 cents. In the year-ago reported quarter, the company had incurred a loss of 92 cents per share.
Operating revenues of $3.14 billion missed the Zacks Consensus Estimate of $3.16 billion. The top line jumped 41% year over year, with passenger revenues accounting for 89.5% of the top line and increasing 40%. The company expects available seat miles to increase 2% to 3% in the second quarter of 2025 from the second quarter of 2024 actuals.