{"id":40255,"date":"2023-07-25T11:32:59","date_gmt":"2023-07-25T15:32:59","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/alaska-air-posts-record-quarterly-revenue-why-airline-stocks-are-tumbling\/"},"modified":"2023-07-25T11:33:01","modified_gmt":"2023-07-25T15:33:01","slug":"alaska-air-posts-record-quarterly-revenue-why-airline-stocks-are-tumbling","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=40255","title":{"rendered":"Alaska Air Posts Record Quarterly Revenue. Why Airline Stocks Are Tumbling."},"content":{"rendered":"
\n
<\/p>\n
<\/p>\n<\/figure><\/div>\n

It\u2019s been a red hot summer for travel and for airline stocks. But the inevitable turbulence has arrived in the slightly surprising form of
\n Alaska Air\u2019s<\/span>
\n earnings.<\/p>\n

The carrier\u2019s update appears to have put the wider sector under pressure, with America\u2019s major airlines plunging into the red Tuesday.\u00a0<\/p>\n

\n

\n Alaska Air\u2019s<\/span>
\n (ticker: ALK) earnings weren\u2019t bad at all. The company, which owns Alaska Airlines and Horizon Air, even posted record quarterly revenue of $2.84 billion and beat earnings estimates.<\/p>\n

But it\u2019s Alaska\u2019s third-quarter guidance that seems to be sparking the sector\u2019s losses. The company is forecasting revenue growth to be anywhere between flat and 3% versus 2022\u2013a deceleration from the 7% growth it reported in the second quarter. <\/p>\n

Alaska stock tumbled 11% in early trading, while
\n JetBlue Airways
\n (JBLU) fell 5.5%,
\n Southwest Airlines
\n (LUV) declined 5.8% and
\n Frontier Group
\n (ULCC) was 6% down.<\/p>\n

Perhaps Alaska\u2019s third-quarter guidance signals the softening in travel demand that investors and Wall Street have long been concerned about. Analysts\u2019 expectations for the full-year have sat below the industry\u2019s own forecasts for some months now, although the gap has been shrinking as the summer\u2019s bumper demand has become clear.<\/p>\n

But it\u2019s not necessarily time to panic. Domestic travel rebounded strongly last summer and into the second half of 2022, so the comparable periods were always going to be tougher.<\/p>\n

Alaska, for example, is still likely to set a new record for quarterly revenue in the third quarter. It\u2019s hardly a slump in demand, yet.<\/p>\n

The three largest and most internationally-exposed airlines\u2013
\n United Airlines
\n (UAL),
\n American Airlines
\n (AAL) and
\n Delta Air Lines
\n (DAL)\u2013should be less impacted by a potential domestic slowdown, or normalization. That\u2019s being reflected in the stock market\u2013the trio are down between 2.8% and 4%, outperforming the larger declines of the low-cost, domestic-focused airlines.<\/p>\n

Southwest\u2019s earnings before the open Thursday will reveal more about how widespread a potential domestic slowdown really is.<\/p>\n

Write to Callum Keown at callum.keown@barrons.com<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

It\u2019s been a red hot summer for travel and for airline stocks. But the inevitable turbulence has arrived in the slightly surprising form of Alaska Air\u2019s earnings. The carrier\u2019s update appears to have put the wider sector under pressure, with America\u2019s major airlines plunging into the red Tuesday.\u00a0 Alaska Air\u2019s (ticker: ALK) earnings weren\u2019t bad […]<\/p>\n","protected":false},"author":1,"featured_media":40256,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[241],"tags":[83],"class_list":["post-40255","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-markets","tag-featured","post_format-post-format-gallery"],"yoast_head":"\nAlaska Air Posts Record Quarterly Revenue. Why Airline Stocks Are Tumbling. | iFintechWorld<\/title>\n<meta name=\"description\" content=\"It\u2019s been a red hot summer for travel and for airline stocks. 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