Alaska Air Group cuts Q4 earnings forecast to $0.10 per share

Alaska Air Group (NYSE: ALK) lowered its fourth-quarter 2025 adjusted earnings per share forecast to approximately $0.10, down from its previous guidance of at least $0.40 per share.

The airline cited several factors that impacted the quarter by approximately $0.55 to $0.60 per share. An internal IT and cloud service provider outage in late October reduced earnings by $0.25 per share. Lost revenue from a government shutdown contributed a $0.15 per share impact, while higher fuel costs and an increased book tax rate for the quarter also affected results.

The government shutdown that began in October led to FAA-mandated flight reductions, resulting in approximately 600 flight cancellations across Alaska Air Group and affecting around 40,000 passengers. The company stated that while operations returned to normal after the government reopened, the disruption reduced earnings per share by approximately $0.15 for the quarter.

Following the October IT outage, Alaska Air Group engaged a third-party consultant to conduct a comprehensive audit of its IT infrastructure and processes. The company stated it is implementing recommendations to strengthen data center resiliency.

The airline updated several fourth-quarter metrics compared to pro forma 2024 results. Capacity is expected to increase by approximately 2%, down from the previous forecast of 2% to 3%. Revenue per available seat mile is projected to rise by about 1%, compared to the earlier guidance of low single digits. Cost per available seat mile excluding fuel is expected to increase by approximately 3%.

Alaska Air Group's adjusted earnings per share guidance assumes an economic fuel price of approximately $2.65 per gallon, non-operating expense of about $50 million, and a tax rate of 40% to 50%.

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