Alaska Air Group reports fourth quarter and full year 2025 results
Achieved single operating certificate for Hawaiian Airlines and Alaska AirlinesReported earnings per share of $0.18, with adjusted earnings per share of $0.43, ahead of expectations and previous guidance rangeGenerated $1.2 billion in operating cash flow for the full year
SEATTLE, Jan. 22, 2026 /PRNewswire/ -- Alaska Air Group Inc. (NYSE:ALK) today reported financial results for the fourth quarter and full year ended December 31, 2025.
"We feel momentum accelerating in 2026 as the Alaska-Hawaiian Airlines combination gains full strength," said CEO Ben Minicucci. "The people across our airlines delivered through a transformational year that set us up to win: an expanding global network, premium travel experiences delivered with care, and Atmos Rewards elevating our 11-year streak as the No. 1 airline loyalty program. Our model is positioned for where travelers are headed, and we're ready to compete as one of four global U.S. airlines."
Quarter in Review
Alaska Air Group's (Air Group) Consolidated Statements of Operations, Consolidated Balance Sheets, and Summary Cash Flow Statement include Hawaiian Airlines from September 18, 2024 onward. For comparability of financial and operational results, historical information has also been provided on a pro forma basis for the full year 2024 within the Supplementary Pro Forma Comparative Financial and Operating Information in this filing and in prior 8-K filings. The results presented for the fourth quarter of 2024 in the supplementary section are as reported given the inclusion of Hawaiian Airlines in Air Group for the full quarter.
Air Group reported fourth quarter GAAP pretax margin of 0.8% and net income per share of $0.18. Our fourth quarter adjusted pretax margin was 1.8% and our adjusted earnings per share was $0.43.
Q4 2025 Results
Prior Expectation
Actual Results
Capacity (ASMs) % change versus 2024
Up ~2%
Up 2.2%
RASM % change versus 2024
Up ~1%
Up 0.6%
CASMex % change versus 2024
Up ~3%
Up 1.3%
Adjusted earnings per share
~$0.10
$0.43
We continued to build on key milestones for our Alaska Accelerate strategy during the quarter, including achieving a single operating certificate for Alaska and Hawaiian Airlines. We achieved record credit card acquisitions, with nearly one fourth of all signups being for the new premium credit card that we introduced late in the third quarter. We began selling our new international routes from Seattle to London and Rome during the quarter, with the first flights scheduled to operate in spring 2026. We are also now selling in six foreign currencies and recently unveiled our Japanese, Korean, and Italian-language based websites, helping drive point of sale outside of the United States to support our expanding international service. These achievements represent continued progress in building the infrastructure to support Air Group's future growth and profitability, and deliver on our Alaska Accelerate goal of $10 earnings per share in 2027 enabled by $1 billion in incremental profit.
Fourth quarter revenue was $3.6 billion, resulting in a 0.6% year-over-year RASM increase despite contending with temporary demand pullback from the government shutdown in November. We believe our fourth quarter unit revenue result will be among the highest in the industry. Corporate travel grew 9% year-over-year, while close-in demand remained strong throughout the fourth quarter as bookings and yields continue to rebound from the challenging environment earlier in the year. Our diverse revenue streams continued to deliver with premium revenue increasing 7% year-over-year, cargo revenue increasing 22% year-over-year, and loyalty revenue increasing 12% year-over-year. Commercial initiatives and synergy capture remained on track for the fourth consecutive quarter.
Unit costs, excluding fuel, freighter costs, and special items increased 1.3% year-over-year. This result is better than prior guidance and signals our teams' renewed focus on cost control. Economic fuel price per gallon was $2.57 per gallon in the fourth quarter, reflecting elevated West Coast refining prices during the quarter.
First Quarter & Full Year 2026 Guidance
In the first three weeks of January, bookings have inflected positive relative to last year. We have seen several of the highest booking days in our history since January 1st with managed corporate revenues up 20% year-over-year for the first quarter. We expect first quarter unit revenues to be solidly positive and earnings per share to be approximately flat year-over-year which would mark another sequential improvement towards earnings expansion.
Given the macroeconomic headwinds the industry experienced in 2025 and the positive emergent demand trends, our guidance for 2026 reflects a wide range of potential macroeconomic outcomes. We expect to continue to realize value from Alaska Accelerate initiatives and synergies from the Hawaiian integration, which remain on track or ahead of plan relative to our initial expectations. To hit the higher end of our guidance range we would require sustained macroeconomic recovery in 2026, at or improving on trends seen in the first three weeks of the year, and for fuel prices to stabilize. Given the inherent uncertainty of the macroeconomic environment, we remain as focused as ever on controlling what is within our control, including disciplined cost management, driving strong productivity and delivering on our initiatives.
Q1 2026 Expectation
FY 2026 Expectation
Capacity (ASMs) % change versus 2025
Up 1% to 2%
2% to 3%
Adjusted earnings (loss) per share(a)
($1.50) to ($0.50)
$3.50 to $6.50
Capital Expenditures
n/a
~$1.4 to $1.5B
(a) Q1 adjusted tax rate is estimated to be 29%. Full year adjusted tax rate is estimated to be 26% to 27%
Financial Results and Updates:
Reported net income for the fourth quarter and full year 2025 under Generally Accepted Accounting Principles (GAAP) of $21 million, or $0.18 per share, and $100 million, or $0.83 per share. These results compare to net income for the fourth quarter and full year 2024 of $71 million, or $0.55 per share, and $395 million, or $3.08 per share.
Reported net income for the fourth quarter and full year 2025, excluding special items and other adjustments, of $50 million, or $0.43 per share, and $293 million, or $2.44 per share. These results compare to net income for the fourth quarter and full year 2024, excluding special items and other adjustments, of $125 million, or $0.97 per share, and $625 million, or $4.87 per share.
Generated adjusted pretax margin of 2.8% for the full year 2025.
Repurchased 0.7 million shares of common stock for approximately $30 million in the fourth quarter, bringing total repurchases to 11.3 million shares for $570 million in 2025.
Operational Updates:
Alaska and Hawaiian achieved a single operating certificate, becoming one airline in the eyes of the FAA and representing the most significant integration milestone to date.
Announced the largest fleet order in Alaska's history in January 2026, including 105 737-10 aircraft, 5 787 aircraft, and options for 35 additional 737-10 aircraft. The order will expand our fleet to 475 aircraft by 2030 and over 550 aircraft by 2035.
Took delivery of six 737-8 aircraft and one 787-9 aircraft in the fourth quarter.
Unveiled our new global livery for our 787 fleet in January 2026, which is planned to fly on our international routes to and from Seattle.
Announced the opening of a new Horizon base in Las Vegas to support regional growth and flying in California.
Network Updates:
Announced the addition of two destinations to Air Group's network, with year-round service to Tulsa and Arcata-Eureka beginning in the spring.
Expanding service from our hubs, including new routes announced for 2026 from San Diego to Dallas, Oakland, and Raleigh-Durham; Portland to Philadelphia, Baltimore, and St. Louis; Honolulu to Burbank; and Anchorage to Boston, Boise, and Spokane.
Customer Experience:
Led U.S. carriers in key performance metrics during the Thanksgiving travel season, including on-time performance and completion rate.
Began installations of Starlink Wi-Fi on our E175 fleet in December, with installations on our mainline fleet to begin in spring 2026.
Announced the Kahu'ewai Hawai'i Investment Plan of more than $600 million over five years to enhance the guest experience from booking to the day of travel, including retrofitting Hawaiian aircraft interiors, modernizing airport spaces in Hawai'i, and upgrading technology.
Our airlines finished 2025 at #2 in completion rate and #2 in on-time performance.
Other Highlights:
Partnered with Washington state leaders, industry partners, and others to launch the Cascadia Sustainable Aviation Accelerator initiative to accelerate the production, deployment, and adoption of sustainable aviation fuel (SAF).
Partnered with Pono Energy to invest in the development of SAF in Hawaiʻi using locally grown agriculture feedstock.
The following table reconciles the company's reported GAAP net income per share (EPS) for the three and twelve months ended December 31, 2025 and 2024 to adjusted amounts.
Three Months Ended December 31,
2025
2024
(in millions, except per share amounts)
Dollars
Per Share
Dollars
Per Share
Net income
$ 21
$ 0.18
$ 71
$ 0.55
Adjusted for:
Mark-to-market fuel hedge adjustments
—
—
(6)
(0.05)
Gains on foreign debt
(4)
(0.03)
(10)
(0.08)
Special items - operating
39
0.33
91
0.71
Special items - net non-operating
—
—
(17)
(0.13)
Income tax effect(a)
(6)
(0.05)
(4)
(0.03)
Adjusted net income
$ 50
$ 0.43
$ 125
$ 0.97
Twelve Months Ended December 31,
2025
2024
(in millions, except per share amounts)
Dollars
Per Share
Dollars
Per Share
Net income
$ 100
$ 0.83
$ 395
$ 3.08
Adjusted for:
Mark-to-market fuel hedge adjustments
(4)
(0.03)
(28)
(0.22)
Losses (gains) on foreign debt
1
0.01
(10)
(0.08)
Special items - operating
250
2.08
345
2.69
Special items - net non-operating
—
—
(16)
(0.12)
Income tax effect(a)
(54)
(0.45)
(61)
(0.48)
Adjusted net income
$ 293
$ 2.44
$ 625
$ 4.87
(a) Includes income tax effect of the adjustments in the tables above as well as one-time effects of the One Big Beautiful Bill Act which was signed into law in the third quarter of 2025.
A conference call regarding the fourth quarter and full year results will be streamed online at 11:30 a.m. EST/ 8:30 a.m. PST on January 23, 2026. It can be accessed at www.alaskaair.com/investors. For those unable to listen to the live broadcast, a replay will be available after the conclusion of the call.
References in this update to "Air Group," "Company," "we," "us," and "our" refer to Alaska Air Group, Inc. and its subsidiaries, unless otherwise specified.
This news release may contain forward-looking statements subject to the safe harbor protection provided by Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995. These statements relate to future events and involve known and unknown risks and uncertainties that may cause actual outcomes to be materially different from those indicated by our forward-looking statements, assumptions or beliefs. For a discussion of risks and uncertainties that may cause our forward-looking statements to differ materially, see Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2024. Some of these risks include competition, labor costs, relations and availability, general economic conditions, increases in operating costs including fuel, uncertainties regarding the ability to successfully integrate operations following the acquisition of Hawaiian Holdings, Inc. and the ability to realize anticipated cost savings, synergies, or growth from the acquisition, inability to meet cost reduction and other strategic goals, seasonal fluctuations in demand and financial results, supply chain risks, events that negatively impact aviation safety and security, cybersecurity risks, and changes in laws and regulations that impact our business. All of the forward-looking statements are qualified in their entirety by reference to the risk factors discussed in our most recent Form 10-K and in our subsequent SEC filings. We operate in a continually changing business environment, and new risk factors emerge from time to time. Management cannot predict such new risk factors, nor can it assess the impact, if any, of such new risk factors on our business or events described in any forward-looking statements. We expressly disclaim any obligation to publicly update or revise any forward-looking statements made today to conform them to actual results. Over time, our actual results, performance or achievements may differ from the anticipated results, performance or achievements that are expressed or implied by our forward-looking statements, assumptions or beliefs and such differences might be significant and materially adverse.
Alaska Airlines, Hawaiian Airlines and Horizon Air are subsidiaries of Alaska Air Group, and McGee Air Services is a subsidiary of Alaska Airlines. We are a global airline with hubs in Seattle, Honolulu, Portland, Anchorage, Los Angeles, San Diego and San Francisco. We deliver remarkable care as we fly our guests to more than 140 destinations throughout North America, Latin America, Asia and the Pacific. We'll serve Europe beginning in spring 2026. Guests can book travel at alaskaair.com and hawaiianairlines.com. Alaska is a member of the oneworld alliance, with Hawaiian scheduled to join oneworld in spring 2026. With oneworld and our additional global partners, guests can earn and redeem points for travel to over 1,000 worldwide destinations with Atmos Rewards. Learn more about what's happening at Alaska and Hawaiian at news.alaskaair.com. Alaska Air Group is traded on the New York Stock Exchange (NYSE) as "ALK."
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
Alaska Air Group, Inc.
Three Months Ended December 31,
Twelve Months Ended December 31,
(in millions, except per share amounts)
2025
2024
Change
2025
2024
Change
Operating Revenue
Passenger revenue
$ 3,248
$ 3,178
2 %
$ 12,835
$ 10,654
20 %
Loyalty program other revenue
238
224
6 %
855
733
17 %
Cargo and other revenue
146
132
11 %
549
348
58 %
Total Operating Revenue
3,632
3,534
3 %
14,239
11,735
21 %
Operating Expenses
Wages and benefits
1,245
1,119
11 %
4,763
3,588
33 %
Variable incentive pay
74
161
(54) %
268
358
(25) %
Aircraft fuel, including hedging gains and losses
737
702
5 %
2,879
2,506
15 %
Aircraft maintenance
214
229
(7) %
912
620
47 %
Aircraft rent
60
65
(8) %
250
207
21 %
Landing fees and other rentals
284
249
14 %
1,109
781
42 %
Contracted services
148
133
11 %
590
444
33 %
Selling expenses
95
106
(10) %
407
349
17 %
Depreciation and amortization
199
190
5 %
795
583
36 %
Food and beverage service
101
93
9 %
383
287
33 %
Third-party regional carrier expense
67
62
8 %
272
243
12 %
Other
294
261
13 %
1,058
854
24 %
Special items - operating
39
91
(57) %
250
345
(28) %
Total Operating Expenses
3,557
3,461
3 %
13,936
11,165
25 %
Operating Income
75
73
3 %
303
570
(47) %
Non-operating Income (Expense)
Interest income
23
32
(28) %
94
101
(7) %
Interest expense
(70)
(56)
25 %
(272)
(171)
59 %
Interest capitalized
8
10
(20) %
37
29
28 %
Special items - net non-operating
—
17
(100) %
—
16
(100) %
Other - net
(6)
3
NM
(16)
—
NM
Total Non-operating Income (Expense)
(45)
6
NM
(157)
(25)
NM
Income Before Income Tax
30
79
146
545
Income tax expense
9
8
46
150
Net Income
$ 21
$ 71
$ 100
$ 395
Basic Earnings Per Share
$ 0.18
$ 0.56
$ 0.85
$ 3.13
Diluted Earnings Per Share
$ 0.18
$ 0.55
$ 0.83
$ 3.08
Weighted Average Shares Outstanding used for computation:
Basic
115.533
126.047
118.171
126.136
Diluted
117.356
128.931
119.926
128.372
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
Alaska Air Group, Inc.
As of December 31 (in millions)
2025
2024
ASSETS
Current Assets
Cash and cash equivalents
$ 627
$ 1,201
Restricted cash
28
29
Marketable securities
1,496
1,274
Total cash, restricted cash, and marketable securities
2,151
2,504
Receivables - net
565
558
Inventories and supplies - net
203
199
Prepaid expenses
278
307
Other current assets
69
192
Total Current Assets
3,266
3,760
Property and Equipment
Aircraft and other flight equipment
13,647
12,273
Other property and equipment
2,424
2,173
Deposits for future flight equipment
731
883
16,802
15,329
Less accumulated depreciation and amortization
(4,945)
(4,548)
Total Property and Equipment - Net
11,857
10,781
Other Assets
Operating lease assets
1,268
1,296
Goodwill
2,723
2,724
Intangible assets - net
815
873
Other noncurrent assets
432
334
Total Other Assets
5,238
5,227
Total Assets
$ 20,361
$ 19,768
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
Alaska Air Group, Inc.
As of December 31 (in millions except share ...
