The tariff-induced uncertainty continued to distort the earnings picture of airlines in the first quarter of 2025. With airline players like American Airlines AAL, Alaska Air Group ALK, Southwest Airlines LUV, JetBlue Airways JBLU and SkyWest SKYW reporting results in the past week, the pain was well-reflected in the reports. The uncertainty also caused airlines like American Airlines to withdraw full-year 2025 projections.

Southwest Airlines also did not reaffirm its guidance for earnings before interest and taxes for 2025 and 2026. Southwest Airlines’ management stated that “Amid the current macroeconomic uncertainty, it is difficult to forecast given recent and short-lived booking trends.”         

Read the last Airline Roundup here.

Recap of the Most Recent Important Stories

1.  American Airlines’ first-quarter 2025 loss (excluding 13 cents from non-recurring items) of 59 cents per share was narrower than the Zacks Consensus Estimate of a loss of 69 cents. In the year-ago quarter, AAL had reported a loss of 34 cents per share. Operating revenues of $12.55 billion edged past the Zacks Consensus Estimate of $12.52 billion but decreased 0.2% year over year.

Passenger revenues, accounting for 90.8% of the top line, decreased 0.6% year over year to $11.4 billion. Passenger revenues were hurt by a slowdown in domestic leisure demand due to tariff woes. AAL expects earnings per share to be between 50 cents and $1 in the second quarter of 2025.

2. Southwest Airlines reported first-quarter 2025 loss of 13 cents per share, which was narrower than the Zacks Consensus Estimate of a loss of 18 cents. In the year-ago quarter, the company had incurred a loss of 36 cents per share.

Revenues of $6.42 billion beat the Zacks Consensus Estimate of $6.40 billion. The top line, however, improved 1.6% year over year. For second-quarter 2025, management expects available seat miles (a measure of capacity) to improve 1-2% from the year-ago reported figure.

LUV currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

3. Alaska Air reported first-quarter 2025 loss of 77 cents per share, wider than the Zacks Consensus Estimate of a loss of 72 cents. In the year-ago reported quarter, the company had incurred a loss of 92 cents per share.

Operating revenues of $3.14 billion missed the Zacks Consensus Estimate of $3.16 billion. The top line jumped 41% year over year, with passenger revenues accounting for 89.5% of the top line and increasing 40%. The company expects available seat miles to increase 2% to 3% in the second quarter of 2025 from the second quarter of 2024 actuals.

4. SkyWest reported better-than-expected first-quarter 2025 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate and improved on a year-over-year basis.

Quarterly earnings per share of $2.42 outpaced the Zacks Consensus Estimate of $2.04 and improved 66% year over year. Revenues of $948.5 million beat the Zacks Consensus Estimate of $931.4 million and improved 18% year over year. Revenues from flying agreements (contributing 96.5% to the top line) grew 17.6% from the prior-year reported figure.

5. JetBlue Airways reported first-quarter 2025 loss of 59 cents per share, narrower than the Zacks Consensus Estimate of a loss of 61 cents. Lower fuel costs aided the bottom line. In the year-ago quarter, JBLU had reported a loss of 43 cents per share.

Operating revenues of $2.14 billion fell short of the Zacks Consensus Estimate of $2.15 billion and decreased 3.1% year over year. Passenger revenues, accounting for the bulk of the top line (92%), declined 3.1% year over year to $1.97 billion. For second-quarter 2025, capacity is anticipated to decline in the 0.5-3.5% band.

Airline Stocks Performance

The following table shows the price movement of the major airline players over the past week and during the last six months.

Image Source: Zacks Investment Research

The NYSE ARCA Airline Index decreased by 3% to $49.03 despite most airline stocks trading in the green over the past week. The Index’s downside was mainly due to the gains being subdued. Over the past six months, the NYSE ARCA Airline Index has decreased by 6.5%.

What’s Next in the Airline Space?

First-quarter 2025 earnings reports from some more airlines are expected in the coming days. Some April traffic reports are also anticipated shortly. Moreover, with signs of easing of trade tensions, investors keenly await further updates on the issue.
 

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Southwest Airlines Co. (LUV) : Free Stock Analysis Report

JetBlue Airways Corporation (JBLU) : Free Stock Analysis Report

American Airlines Group Inc. (AAL) : Free Stock Analysis Report

Alaska Air Group, Inc. (ALK) : Free Stock Analysis Report

SkyWest, Inc. (SKYW) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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