Core Viewpoint - Alaska Air Group (ALK) reported quarterly earnings of $1.78 per share, exceeding the Zacks Consensus Estimate of $1.56 per share, but down from $2.55 per share a year ago, indicating a +14.10% earnings surprise [1][2] Financial Performance - The company posted revenues of $3.7 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.26%, compared to $2.9 billion in the same quarter last year [2] - Over the last four quarters, Alaska Air has exceeded consensus EPS estimates three times and topped revenue estimates three times [2] Stock Performance and Outlook - Alaska Air shares have declined approximately 18.1% since the beginning of the year, contrasting with the S&P 500's gain of 7.3% [3] - The current consensus EPS estimate for the upcoming quarter is $1.97 on revenues of $3.74 billion, and for the current fiscal year, it is $3.47 on revenues of $14.17 billion [7] Industry Context - The Transportation - Airline industry is currently in the top 36% of over 250 Zacks industries, suggesting that stocks in the top 50% outperform those in the bottom 50% by more than 2 to 1 [8]

[Alaska Air Group Second Quarter 2025 Results](index=1&type=section&id=Alaska%20Air%20Group%20reports%20second%20quarter%202025%20results) [Performance and Outlook](index=1&type=section&id=Quarter%20in%20Review) Alaska Air Group reported strong Q2 2025 results with **$1.78** adjusted EPS, achieving record **$3.7 billion** revenue and raising full-year EPS forecast to over **$3.25** - Reported adjusted earnings per share of **$1.78**, surpassing the high end of the previous guidance range (**$1.15 to $1.65**) and Wall Street expectations[2](index=2&type=chunk)[6](index=6&type=chunk) - Hawaiian Airlines' second quarter adjusted pretax margin expanded by **11 points** year-over-year, reaching breakeven for the first time since 2019[7](index=7&type=chunk) - Full-year 2025 earnings per share outlook has been raised to greater than **$3.25**, reflecting positive booking trends and margin-accretive capacity adjustments[9](index=9&type=chunk) Q2 2025 Performance vs. Expectation (Pro Forma 2024) | Metric | Prior Expectation | Actual Results | | :--- | :--- | :--- | | Capacity (ASMs) % Change | Up 2% to 3% | Up ~2.7% | | RASM % Change | Flat to down low single digits | Down ~(0.6)% | | CASMex % Change | Up mid to high single digits | Up ~6.5% | | Adjusted EPS ($) | $1.15 to $1.65 | $1.78 | Q3 and Full Year 2025 Outlook (vs. Pro Forma 2024) | Metric | Q3 Expectation | Full Year Expectation | | :--- | :--- | :--- | | Capacity (ASMs) % Change | Down ~1% | Up ~2% | | RASM % Change | Flat to up low single digits | Flat to up low single digits | | CASMex % Change | Up mid to high single digits | Up mid single digits | | Adjusted EPS ($) | $1.00 to $1.40 | >$3.25 | [Financial and Operational Updates](index=2&type=section&id=Financial%20and%20Operational%20Updates) In Q2 2025, the company repurchased **$428 million** in stock, expanded its global network, added twelve aircraft, and ratified a labor agreement - Repurchased **8.7 million shares** for approximately **$428 million** in Q2, bringing the year-to-date total to **$535 million**[15](index=15&type=chunk) - Announced its first-ever transatlantic route from Seattle to Rome, starting May 2026, and began new nonstop service to Tokyo[15](index=15&type=chunk) - Expanded the combined fleet by **twelve aircraft** in Q2, including Boeing 737s, 787s, E175s, and A330 freighters, also exercising options for **twelve 737-10s**[15](index=15&type=chunk) - Ratified a four-year collective bargaining agreement with Horizon's AMFA-represented technicians[15](index=15&type=chunk) - Loyalty program enhancements include allowing Companion Fare redemption on Hawaiian Airlines flights and expanding partnerships with Qantas and Philippine Airlines[15](index=15&type=chunk) [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) Consolidated Q2 2025 statements show total operating revenue increased **28%** to **$3.7 billion**, operating expenses up **33%**, resulting in **$172 million** GAAP net income [Condensed Consolidated Statements of Operations](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS%20(unaudited)) Q2 2025 statements show total operating revenues of **$3.704 billion** (up **28%**), operating expenses of **$3.427 billion** (up **33%**), resulting in **$172 million** GAAP net income Q2 2025 vs Q2 2024 Statement of Operations (in millions) | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Operating Revenue ($ millions) | $3,704 | $2,897 | 28% | | Total Operating Expenses ($ millions) | $3,427 | $2,575 | 33% | | Operating Income ($ millions) | $277 | $322 | (14)% | | Net Income ($ millions) | $172 | $220 | (22)% | | Diluted EPS ($) | $1.42 | $1.71 | (17)% | [Condensed Consolidated Balance Sheets](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS%20(unaudited)) As of June 30, 2025, total assets were **$19.885 billion**, total liabilities **$15.943 billion**, and total shareholders' equity **$3.942 billion**, reflecting share repurchases Balance Sheet Summary (in millions) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Current Assets ($ millions) | $3,507 | $3,760 | | Total Property and Equipment - net ($ millions) | $11,215 | $10,781 | | **Total Assets ($ millions)** | **$19,885** | **$19,768** | | Total Current Liabilities ($ millions) | $6,709 | $6,145 | | Total Noncurrent Liabilities ($ millions) | $9,234 | $9,251 | | **Total Liabilities ($ millions)** | **$15,943** | **$15,396** | | **Total Shareholders' Equity ($ millions)** | **$3,942** | **$4,372** | [Summary Cash Flow](index=8&type=section&id=SUMMARY%20CASH%20FLOW%20(unaudited)) For the six months ended June 30, 2025, net cash from operations was **$835 million**, with investing and financing activities using **$747 million** and **$544 million**, resulting in a **$456 million** net cash decrease Cash Flow Summary - Six Months Ended June 30, 2025 (in millions) | Activity | Amount ($ millions) | | :--- | :--- | | Net cash provided by operating activities | $835 | | Net cash used in investing activities | $(747) | | Net cash used in financing activities | $(544) | | **Net decrease in cash and cash equivalents** | **$(456)** | [Operating Statistics and Segment Information](index=9&type=section&id=Operating%20Statistics%20and%20Segment%20Information) Q2 2025 consolidated operating statistics show **32.2%** capacity increase and stable **83.9%** load factor, with Alaska Airlines remaining profitable and Hawaiian Airlines achieving **$1 million** pre-tax profit [Operating Statistics](index=9&type=section&id=OPERATING%20STATISTICS%20(unaudited)) Q2 2025 consolidated capacity (ASMs) grew **32.2%** and traffic (RPMs) **31.8%**, with load factor at **83.9%** and CASMex increasing **10.2%** to **10.90 cents** Consolidated Operating Statistics - Q2 2025 vs Q2 2024 | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | ASMs (millions) | 24,058 | 18,196 | 32.2% | | Load Factor | 83.9% | 84.1% | (0.2) pts | | RASM (¢) | 15.39¢ | 15.92¢ | (3.3)% | | CASMex (¢) | 10.90¢ | 9.89¢ | 10.2% | | Economic Fuel Cost per Gallon ($) | $2.39 | $2.84 | (15.8)% | [Operating Segments](index=13&type=section&id=OPERATING%20SEGMENTS%20(unaudited)) Q2 2025 segment results show Alaska Airlines with **$2.37 billion** revenue and **$267 million** adjusted pre-tax income, Hawaiian Airlines with **$857 million** revenue and **$1 million** pre-tax income, and Regional with **$471 million** revenue and **$7 million** pre-tax income Adjusted Income Before Tax by Segment - Q2 2025 (in millions) | Segment | Operating Revenue ($ millions) | Adjusted Income Before Tax ($ millions) | | :--- | :--- | :--- | | Alaska Airlines | $2,373 | $267 | | Hawaiian Airlines | $857 | $1 | | Regional | $471 | $7 | | **Air Group Adjusted Total** | **$3,704** | **$295** | [Non-GAAP Reconciliations and Supplementary Information](index=4&type=section&id=Non-GAAP%20Reconciliations%20and%20Supplementary%20Information) Non-GAAP reconciliations for Q2 2025 show adjusted net income of **$215 million** (**$1.78**/share), with pro forma data indicating **2%** revenue growth but a decline in adjusted pre-tax margin from **10.3%** to **8.0%** GAAP to Adjusted Net Income Reconciliation - Q2 2025 (in millions) | Item | Amount ($ millions) | Per Share ($) | | :--- | :--- | :--- | | **GAAP Net Income** | **$172** | **$1.42** | | Mark-to-market fuel hedge adjustments | $(1) | $(0.01) | | Losses on foreign debt | $2 | $0.02 | | Special items - operating | $56 | $0.46 | | Income tax effect | $(14) | $(0.11) | | **Adjusted Net Income** | **$215** | **$1.78** | Pro Forma Financial Comparison - Q2 2025 vs Q2 2024 (in millions) | Metric | Q2 2025 (Actual) ($ millions) | Q2 2024 (Pro Forma) ($ millions) | % Change | | :--- | :--- | :--- | :--- | | Total Operating Revenue | $3,704 | $3,629 | 2% | | Adjusted Income Before Income Tax | $295 | $374 | (21)% | | Adjusted Pretax Margin | 8.0% | 10.3% | (2.3) pts | - Pro forma CASMex (unit cost ex-fuel) increased **6.5%** year-over-year, from **10.23¢** to **10.90¢**, indicating rising underlying operational costs for the combined entity[46](index=46&type=chunk) [Appendix](index=16&type=section&id=Appendix) The appendix defines key industry and financial terms in its Glossary and explains the rationale for non-GAAP measures like CASMex and adjusted pre-tax income, enhancing investor analysis [Note on Non-GAAP Measures](index=16&type=section&id=Note%20A) This note explains non-GAAP measures like CASMex and adjusted pre-tax income provide investors better visibility into core operational results by excluding certain costs, used by management for performance assessment - The company excludes certain costs (fuel, freighter, special items) from unit metrics to provide better visibility into controllable operational results and for comparability with other carriers[47](index=47&type=chunk) - CASMex is a key metric used by management and the Board to assess cost performance, and adjusted pre-tax income is important for employee incentive plans[47](index=47&type=chunk) [Glossary of Terms](index=17&type=section&id=GLOSSARY%20OF%20TERMS) This section defines key aviation and financial acronyms and terms used in the report, including ASM, CASMex, RASM, and EBITDAR - Defines key performance indicators such as ASMs (capacity), RPMs (traffic), Load Factor (percentage of seats filled), and Yield (revenue per passenger mile)[48](index=48&type=chunk) - Clarifies financial metrics including CASMex (unit cost), RASM (unit revenue), and various adjusted debt calculations[48](index=48&type=chunk)

Stock Market & Finance - Block's shares are significantly up following the announcement of its inclusion in the S&P 500, replacing Hess after its acquisition by Chevron [1] Aviation Industry - Alaska Airlines resumed operations after a systemwide ground stop lasting approximately 3 hours due to an IT outage [2] Trade & International Relations - China's exports of rare earth magnets to the US increased over sixfold in June compared to May, but were still about 40% lower than the same month last year [3] Politics & Economy - Trump administration officials are reportedly planning a visit to the Federal Reserve amid a probe involving headquarters renovation [4] Corporate Governance - Data company Astronomer's CEO Andy Brown resigned after a social media incident at a Coldplay concert, prompting a formal investigation [5]

Core Viewpoint - Alaska Airlines announced a temporary suspension of all flights due to an information technology failure, although the nature of the failure was not disclosed [1] Group 1 - The operational impact was significant enough to require a full flight suspension for Alaska Airlines and its subsidiary Horizon Air [1] - Approximately three hours later, Alaska Airlines announced that the flight suspension had been lifted [1] - In June, a related incident occurred when Hawaiian Airlines, a subsidiary of Alaska Airlines Group, reported a cyberattack on some of its information technology systems [1]

阿拉斯加航空公司表示，其早前的信息技术系统故障已得到解决。 ...

阿拉斯加航空：地面停飞已解除，已于太平洋时间晚上11点（北京时间下午2点）恢复。 ...

智通财经7月21日电，据美国联邦航空管理局7月21日消息，阿拉斯加航空所有干线和地平线航空航班停 飞取消。 ...

Core Points - Alaska Airlines experienced an IT outage that led to a temporary, system-wide ground stop for its flights, including those operated by its regional subsidiary, Horizon Air [1][2] - The airline has apologized for the disruption and warned passengers of potential residual impacts on operations [2] - Alaska Air Group operates a fleet of 238 Boeing 737 aircraft and 87 Embraer 175 aircraft [3] - The company is currently assessing the financial impact of the IT outage [4]

智通财经7月21日电，据美国联邦航空管理局消息，阿拉斯加航空7月21日要求停飞所有干线和地平线航 空的飞机。 ...

Alaska Air requested all planes that operate under its main brand and Horizon Air unit be grounded in a notice to the US Federal Aviation Administration late Sunday. The reason for the request wasn’t immediately given https://t.co/c1k0zG9VDG ...