Alaska Air Group Inc.
03/30/2026 | Press release | Distributed by Public on 03/30/2026 06:01
Regulation FD Disclosure (Form 8-K)
Item 7.01 Regulation FD Disclosure
Despite what has become another challenging first quarter operating environment in 2026, Air Group continues to execute well on its strategy and areas of the business within its control, with encouraging revenue trends heading into the peak travel season. Demand has shown continued strength throughout our network, with unit revenue tracking in line with prior expectations and capacity toward the high end of the previously guided range, up ~2%, supported by one of the most reliable operations in the industry.
The clear underlying demand strength that began in Q4 of 2025 and accelerated into the new year has recently been challenged by several external events.
These include demand pullback in Mexico due to unrest in Puerto Vallarta as well as severe rainstorms and historic flooding in Hawaiʻi, which combined represent ~30% of our capacity. Impacts are being seen in both March and April, including during peak West Coast Spring Break travel periods. With respect to Hawai'i, we do not believe there will be a longer-term structural impact and expect demand to fully recover.
Revenue trends across the rest of the network heading into Q2 2026 are encouraging. Managed corporate demand remains a standout, with forward bookings over the next 90 days up more than 25% year over year. Held second quarter yields and load factors are also up year over year with significant strength in May and June. With 55% of the quarter's revenue still to come, Air Group is well positioned for peak travel periods during our seasonally strongest quarter.
Fuel costs have increased materially due to sharply higher crude and refining prices - with refining margins that have been particularly volatile in recent weeks. Our lowest cost source of fuel typically comes from Singapore which represents approximately 20% of Air Group's fuel supply. These refining margins have surged ~400% since early February, from an average of ~$0.45 to ~$2.25 per gallon. This compares to US refining costs that are up ~140% in the same period. As a result, economic fuel price is now expected to average $2.90 to $3.00 per gallon, representing an incremental EPS headwind of at least ($0.70). Absent impacts from fuel, Puerto Vallarta, and Hawaiʻi storms, Air Group's results would have exceeded the midpoint of original guidance, however Q1 2026 adjusted loss per share is now expected to be ($2.00) to ($1.50).
Pursuant to 17 CFR Part 243 (Regulation FD), the Company is submitting information relating to its financial and operational outlook. In accordance with General Instruction B.2 of Form 8-K, the information under this item shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing. This report will not be deemed an admission as to the materiality of any information required to be disclosed solely to satisfy the requirements of Regulation FD.
Alaska Air Group Inc. published this content on March 30, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on March 30, 2026 at 12:04 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]