Alaska Air posts adjusted loss of $0.31 a share amid fuel pressures

Key Facts

Alaska Air Group reported an adjusted loss of $0.31 a share in the third quarter of 2026, including a tax adjustment tied to a shift in its full-year outlook to a loss amid fuel pressures. The company said in its earnings statement that it earned an adjusted $0.36 a share excluding the adjustment. The group reported adjusted earnings of $1.05 a share in the corresponding period of 2025, according to its disclosure for that period. Its loss per share under U.S. generally accepted accounting principles was $1.32 in the third quarter of the current year. Its adjusted pretax profit margin was 1.1%, according to the group's financial results.

The company attributed the tax adjustment to a revision in its expected annual tax rate after its outlook shifted from a pretax profit to a loss, primarily because of higher fuel costs. The adjustment relates to tax benefits the group had previously recognized on losses in the first half of the year. Third-quarter revenue totaled $4.3 billion, according to the company's statement, while revenue per available seat mile rose 11.7% from the same period a year earlier, according to the financial supplement. Passenger yield increased about 17% year on year in September, according to figures the group released on its performance for the month. Premium services accounted for more than 36% of total quarterly revenue.

The economic cost of fuel was $3.94 per gallon in the third quarter, according to the financial supplement accompanying Alaska Air's earnings release. Adjusted unit costs excluding fuel rose 4.4% year on year during the period, with cost increases extending beyond jet fuel. On cash flow, the group said it generated $755 million from operating activities in the first nine months of 2026. Available liquidity stood at $3.3 billion at the end of the third quarter, according to the earnings statement. The liquidity balance includes unrestricted cash and securities, as well as the group's undrawn credit facilities.

The group's outlook for 2026 includes fuel expense exceeding its plan by $1.8 billion, while it expects fourth-quarter fuel costs alone to exceed its initial plan by $650 million. Reuters quoted the company as forecasting an "adjusted loss of $2 to $2.50 a share" in the fourth quarter. That exceeds analysts' average estimate for a loss of $1.04 a share, according to London Stock Exchange Group data cited by the news agency. The operating outlook includes year-on-year capacity growth of between 1% and 1.5% in the fourth quarter, concentrated in international flying, according to the company. The group also expects unit costs excluding fuel to rise at a mid-single-digit rate as capacity growth slows.

Alongside its financial outlook, Alaska Air announced plans to join American Airlines' transatlantic and transpacific joint ventures, according to a statement from the companies. The transpacific joint venture includes American Airlines and Japan Airlines. Alaska and American intend to seek approval and antitrust immunity from the U.S. Department of Transportation to carry out the plans to join. The steps the companies intend to take also include securing international approvals, according to their joint announcement. In a separate announcement on international network expansion, Alaska and Hawaiian Airlines said the newly announced routes are subject to government approval.

Alaska Air Group will hold its earnings conference call on October 21, 2026, according to its webcast announcement. Under the announced international expansion schedule, Alaska and Hawaiian Airlines set May 14, 2027, as the launch date for nonstop service between Seattle and Osaka. The company plans to operate the route with 4 flights a week at launch, according to the network expansion statement. The companies set June 11, 2027, as the launch date for the Seattle-to-Papeete route, among the international destinations announced. Papeete service is scheduled to operate with 3 flights a week at launch, according to the schedule announced by the companies.