Alaska Air Group NYSE: ALK executives highlighted progress on merger integration, expanding international service, and premium and loyalty initiatives during the company’s 2025 fourth-quarter earnings call, while also outlining a wide guidance range for 2026 that reflects continued industry volatility.
Fourth-quarter and full-year results
Vice President of Finance, Planning, and Investor Relations Ryan St. John said the company reported fourth-quarter GAAP net income of $21 million and full-year GAAP net income of $100 million. Excluding special items and mark-to-market fuel hedge adjustments, adjusted net income was $50 million for the quarter and $293 million for the year.
CEO Ben Minicucci said Alaska Air Group delivered adjusted earnings per share (EPS) of $0.43 in the fourth quarter and $2.44 for the full year, “both ahead of our revised guidance” issued in early December. Management reiterated that 2025 results were affected by an IT outage, higher fuel costs, and the impact of a government shutdown.
Chief Financial Officer Shane Tackett added that fourth-quarter adjusted EPS exceeded the early-December guidance by $0.33, attributing roughly half of the outperformance to better non-fuel cost performance, with the remainder driven by lower December fuel costs as West Coast refining margins normalized and a lower tax rate due to higher earnings.
Revenue trends: premium strength, corporate momentum, and loyalty growth
Chief Commercial Officer Andrew Harrison said fourth-quarter revenue totaled $3.6 billion, up 2.8% year-over-year on 2.2% capacity growth, resulting in unit revenue up 0.6 points. For the full year, revenue was $14.2 billion, up 3.3% on 1.9% capacity growth, with unit revenue up 1.4%.
Harrison said the company saw continued strength in premium demand:
- Fourth quarter: first and premium class revenues up 7.1% year-over-year, outperforming main cabin by 9.5 points; premium revenue was 36% of total revenue.
- Full year: premium cabin revenues up 6.7%, outperforming main cabin by seven points.
He said 86% of seat retrofits across the company’s 218 Boeing 737 aircraft were complete, with 31 737-800s remaining, and that the retrofit program is expected to be finished in time to sell into summer travel. Harrison tied the retrofit to plans to sell 1.3 million incremental premium seats and to fully realize $100 million of incremental profit outlined under the Alaska Accelerate plan.
On corporate travel, Harrison said managed corporate revenues rose 9% year-over-year in the fourth quarter despite the shutdown and that forward-looking business bookings for 2026 were “very encouraging.” Held managed corporate revenue on the books was up 20% year-over-year for the first quarter, with notable gains in technology, manufacturing, and financial services. In response to analyst questions, management characterized the growth as volume-driven and linked it to increased relevance from network expansion.
Loyalty was another key focus following the August launch of the unified Atmos Rewards program. Harrison said fourth-quarter loyalty revenues (including bank cash and member redemptions) rose 12% year-over-year, and full-year bank cash remuneration was $2.1 billion, up 10%. He also said credit card acquisitions for the full year were up 17% year-over-year, and that the Atmos Summit Card drove record quarterly card acquisitions in Q4, with nearly one-fourth of new acquisitions coming from the premium product.
Minicucci said the premium credit card generated 75,000 sign-ups in four months, exceeding expectations by three times.
Integration milestones, aircraft order, and technology issues
Minicucci described 2025 as “a year of transformation,” citing progress integrating Alaska and Hawaiian, including achieving a single operating certificate in October, 13 months post-merger. He said operational cutover to a combined passenger service system (PSS) is scheduled for April 2026 to eliminate friction from operating dual systems. In the Q&A, management said the major guest-facing commercial systems are now “single and in place,” with April representing the milestone when customers begin flying on the new PSS.
Minicucci also said the company secured its largest aircraft order in history with Boeing, which “solidifies our growth through 2035” and results in an order book of 261 aircraft if all options are exercised. He said firm orders would take the company’s 787 fleet to a total of 17 aircraft, supporting a goal of building Seattle into a global hub with at least 12 destinations.
Executives acknowledged technology challenges. Minicucci said two outages in 2025 were “painful” for guests, employees, and financial results, and that corrective actions are underway with third-party support. In response to analyst questions, management said the issues involved configuration and hardware failures, with backup systems not activating as intended, and that mitigation and resiliency investments are already included in 2026 guidance.
2026 outlook: modest capacity growth, earnings range, and key sensitivities
Management framed 2026 as a year of “harvesting and optimizing” investments made in 2025. Tackett provided 2026 adjusted EPS guidance of $3.50 to $6.50 and first-quarter guidance of a loss of $1.50 to $0.50. He said the guidance range is wider than normal due to volatility, and outlined assumptions for both ends of the range.
Harrison said capacity growth will be modest, citing only six 737 deliveries while awaiting MAX 10 certification. The company expects first-quarter capacity to rise 1% to 2% and full-year capacity to grow 2% to 3%. He said “100% of our net growth is represented by new long-haul out of Seattle,” and that domestic capacity has been shifted to support growth in Portland and San Diego.
International expansion remains central to the strategy. Harrison said new routes to London, Rome, and Iceland are “selling extremely well,” and that Alaska has enabled onward access beyond those cities. He also said the company is finalizing regulatory approvals for 17 codeshare destinations beyond London, which would bring the total to 55 destinations, and that improved departure times on the Seattle–Seoul Incheon route will take effect in late April 2026.
On demand, executives cited strong recent booking trends. Harrison said advanced bookings had been “well into the double digits” since January 6, and Tackett said current demand had strengthened again after a brief shutdown-related interruption. Management also highlighted fuel as a key swing factor; Tackett said every $0.10 change in full-year fuel price translates to $0.75 of EPS. In a separate discussion, management attributed West Coast fuel volatility to refinery instability, noting that about 50% of the company’s fuel exposure is tied to the West Coast and that supply diversification efforts could take roughly two years.
Minicucci and Tackett reiterated a goal of reaching $10 of EPS by 2027, emphasizing execution on the Alaska Accelerate plan and a macro environment consistent with prior assumptions.
About Alaska Air Group NYSE: ALK
Alaska Air Group is a publicly traded holding company headquartered in Seattle, Washington, that operates two main airlines—Alaska Airlines and Horizon Air. Through these carriers, the company offers scheduled passenger and cargo services across a network spanning the United States, Canada and Mexico. Its core business activities include domestic and international air transportation, loyalty program management under the Mileage Plan brand, and ancillary revenue streams such as baggage fees, in-flight sales and code-share partnerships with other global airlines.
The roots of Alaska Air Group trace back to the foundation of its flagship carrier, Alaska Airlines, in 1932.
Featured Stories
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
Before you consider Alaska Air Group, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Alaska Air Group wasn't on the list.
While Alaska Air Group currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
MarketBeat's analysts have just released their top five short plays for February 2026. Learn which stocks have the most short interest and how to trade them. Click the link to see which companies made the list.
Get This Free Report
