ALK

American Airlines AAL reported a third-quarter 2026 loss (excluding 13 cents from non-recurring items) of 28 cents per share, wider than the year-ago loss of 17 cents. However, the figure was in line with the Zacks Consensus Estimate. Results were hurt by elevated fuel expenses. Operating revenues surged 19.3% year over year to a record $16.34 billion and surpassed the consensus mark of $16.20 billion by 0.8%. Revenue growth was supported by strong premium demand, higher passenger yields and robust corporate travel. Total revenue per available seat mile increased 14.5%. Passenger revenues climbed 19.5% year over year to $14.90 billion. Cargo revenues increased 29.1% to $274 million, while other revenues advanced 15.2% to $1.16 billion. Passenger yield rose 18.3% to 22.15 cents, reflecting stronger pricing. Passenger revenue per available seat mile increased 14.6% to 18.47 cents. Revenue passenger miles grew 1%, while capacity, measured in available seat miles, expanded 4.2%. The passenger load factor (% of seats filled with passengers) declined 2.6 percentage points to 83.4%, just ahead of our estimate of 83%. American Airlines price-consensus-eps-surprise-chart | American Airlines Quote Premium revenues increased 22.9% year over year, outperforming the 19.5% rise in Main Cabin revenues. Premium passenger unit revenues advanced 18.5%, compared with 14.4% growth in Main Cabin. Managed corporate revenues jumped 27.6%, marking the sixth consecutive quarter of double-digit growth. Domestic passenger revenues rose 20.2% to $10.49 billion, supported by a 13.6% increase in passenger unit revenues. International passenger revenues grew 17.7% to $4.41 billion. Latin America revenues climbed 20.7%, while Atlantic and Pacific revenues increased 15.6% and 18.5%, respectively. Total operating expenses rose 19.8% year over year to $16.22 billion. Aircraft fuel and related taxes surged 67.5% to $4.64 billion, reflecting a 62.7% increase in the average fuel price to $3.85 per gallon. Salaries, wages and benefits increased 5.7% to $4.71 billion. Maintenance, materials and repairs rose 6.2% to $1.09 billion, while regional operating expenses increased 5.5% to $1.36 billion. CASM excluding special items, fuel and profit sharing advanced 3% to 14.34 cents. GAAP operating income declined 23.4% year over year to $115 million. The reported operating margin narrowed to 0.7% from 1.1%, as higher fuel expenses more than offset the benefits of record revenues. Adjusted operating income declined 16.2% to $132 million, while the adjusted operating margin contracted to 0.8% from 1.2%. GAAP net loss widened to $269 million, or 41 cents per share, compared with a loss of $114 million, or 17 cents, a year earlier. AAdvantage enrollments increased 27.4% year over year, while spending on the company's co-branded Citi credit cards grew nearly 10%. Commercial initiatives contributed to a 6-percentage-point increase in the upsell rate from Basic Economy to Main Cabin. American also announced plans to extend Starlink Wi-Fi installations across its entire mainline fleet, covering more than 1,000 aircraft. The carrier continues investing in premium lounges, seatback entertainment and fleet modernization. Its narrowbody retrofit program is expected to increase premium seating to 40% in the coming years. AAL ended the third quarter with $11.8 billion in total available liquidity. Cash totaled $1.12 billion, while short-term investments stood at $7.16 billion at September-end. Operating cash flow for the first nine months of 2026 increased to $4.54 billion from $3.37 billion a year ago. Capital expenditures and aircraft purchase deposits totaled $2.73 billion. The company repaid $5.35 billion in long-term debt and finance leases while issuing $5.93 billion of long-term debt. For the fourth quarter, AAL expects revenues to increase 19.5-22.5% year over year, with capacity growth of 5.5-6.5%. CASM, excluding special items, fuel and profit sharing, is projected to rise 2.5-3.5%. Management expects fourth-quarter adjusted loss between 50 cents and $1.10 per share. The Zacks Consensus Estimate is currently pegged at a loss of 40 cents per share. The outlook assumes an average fuel price of approximately $4.70 per gallon and a $2.8 billion year-over-year increase in fuel expenses. For full-year 2026, American Airlines anticipates adjusted loss ranging from $1 to $1.60 per share. The Zacks Consensus Estimate is currently pegged at a loss of 94 cents per share. Given elevated fuel prices, the carrier expects network growth in 2027 to slow from 2026 levels. American Airlines has a Zacks Rank #4 (Sell) at present. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Delta Air Lines DAL reported third-quarter 2026 earnings (excluding 57 cents from non-recurring items) of $1.72 per share, missing the Zacks Consensus Estimate of $1.80 by 4.44%. Earnings increased year over year despite sharply higher fuel costs and rising non-fuel expenses. Adjusted revenues climbed 16% year over year to $17.59 billion but missed the consensus estimate of $17.74 billion by 0.9%. Broad demand strength and healthy yields lifted adjusted total revenue per available seat mile, or TRASM, 15%, while premium and diversified revenue streams continued to expand. Alaska Air Group, Inc. ALK reported third-quarter 2026 adjusted earnings of 36 cents per share, excluding certain tax impacts, beating the Zacks Consensus Estimate of 35 cents by 2.9%. The company had reported adjusted earnings of $1.05 per share a year earlier. Higher fuel expenses weighed on profitability despite strong revenue momentum. Operating revenues increased 14.4% year over year to $4.30 billion but missed the consensus mark of $4.31 billion by 0.1%. Revenue per available seat mile, or RASM, rose 11.7%, supported by strong yields, premium demand and loyalty revenues. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report American Airlines Group Inc. (AAL) : Free Stock Analysis Report Delta Air Lines, Inc. (DAL) : Free Stock Analysis Report Alaska Air Group, Inc. (ALK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Union Pacific Corporation UNP reported impressive third-quarter 2026 results, wherein both earnings and revenues beat the Zacks Consensus Estimate. Strong volume growth, core pricing gains and higher fuel surcharge revenues contributed to the results. Quarterly adjusted earnings (excluding 4 cents from acquisition-related expenses) of $3.53 per share beat the Zacks Consensus Estimate of $3.47 by 1.7% and increased 14.6% year over year. Operating revenues of $7.20 billion surpassed the consensus estimate of $7.12 billion by 1.1% and rose 15.3% year over year. Revenue carloads increased 6% year over year. Union Pacific Corporation price-consensus-eps-surprise-chart | Union Pacific Corporation Quote Freight revenues (accounting for approximately 95% of the top line) increased 14.9% year over year to $6.81 billion. Freight revenues excluding fuel surcharge increased 6% year over year to $5.64 billion. Fuel surcharge revenues surged to $1.17 billion from $602 million in the year-ago quarter. Other revenues increased 21.1% year over year to $384 million. Total revenue carloads reached 2.29 million compared with 2.16 million in the prior-year quarter. Average revenue per car increased 8% year over year to $2,971, reflecting improved revenue generation per shipment. Operating income increased 15.5% year over year to $2.94 billion. Total operating expenses increased 15.1% year over year to $4.25 billion, primarily due to higher fuel prices, inflation and volume-related expenses. Fuel expenses surged 68.8% year over year to $1.04 billion. Expenses on purchased services and materials increased 9.2% year over year to $746 million. Compensation and benefits expenses rose 4.1% to $1.26 billion, while depreciation expenses increased 4% to $643 million. Equipment and other rents declined 2.8% to $206 million. The operating ratio (operating expenses as a percentage of revenues) improved 10 basis points year over year to 59.1% on a reported basis. However, the adjusted operating ratio deteriorated 30 basis points year over year to 58.8%. Higher fuel prices negatively impacted the operating ratio by 140 basis points. Bulk freight revenues were $2.12 billion, up 9.6% year over year. Segmental revenue carloads remained nearly flat at 529,000. Grain and grain products revenues increased 11% to $1.09 billion, while coal and renewables revenues rose 12% to $525 million despite a 3% decline in carloads. Industrial freight revenues totaled $2.51 billion, up 14.4% year over year. Segmental revenue carloads increased 6% to 606,000. Metals and minerals revenues climbed 17% to $666 million, while energy and specialized markets revenues increased 18% to $771 million. Freight revenues in the Premium division were $2.19 billion, up 21.4% year over year. Premium revenue carloads increased 9% to 1.16 million. Intermodal revenues rose 27% to $1.52 billion, supported by an 11% increase in intermodal carloads. Automotive revenues grew 11% to $671 million. Freight car velocity improved 1% year over year to 228 daily miles per car. Average terminal dwell time declined 2% to 19.9 hours, reflecting improvements in terminal operations. Workforce productivity increased 5% to 1,219 car miles per employee. Train length increased 2% to 9,969 feet, while locomotive productivity remained flat at 140 gross ton-miles per horsepower-day. The fuel consumption rate improved 2% to 1.034 gallons per thousand gross ton-miles. However, intermodal and manifest service performance indexes declined six and seven percentage points, respectively. Union Pacific exited the third quarter of 2026 with cash and cash equivalents of $2.21 billion compared with $1.27 billion at the end of 2025. Long-term debt stood at $29.04 billion compared with $30.29 billion at 2025-end. During the first nine months of 2026, cash provided by operating activities increased to $8.30 billion from $7.07 billion in the corresponding year-ago period. Free cash flow rose to $2.36 billion from $1.86 billion. The company repaid $1.52 billion of debt during the period. For 2026, Union Pacific continues to expect reported earnings per share (EPS) growth in the high-single digits, consistent with its three-year compound annual growth rate target of high-single-digit to low-double-digit growth through 2027. UNP updated its capital investment plan to $3.5 billion. Currently, UNP carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Alaska Air Group, Inc. ALK reported third-quarter 2026 adjusted earnings of 36 cents per share, excluding certain tax impacts, beating the Zacks Consensus Estimate of 35 cents by 2.9%. The company had reported adjusted earnings of $1.05 per share a year earlier. Higher fuel expenses weighed on profitability despite strong revenue momentum. Operating revenues increased 14.4% year over year to $4.30 billion but missed the consensus mark of $4.31 billion marginally by 0.1%. Wabtec Corporation WAB reported mixed third-quarter 2026 results, wherein earnings surpassed the Zacks Consensus Estimate, but revenues missed the same. Quarterly earnings (excluding 41 cents from non-recurring items) of $2.83 per share beat the Zacks Consensus Estimate of $2.72 by 4.04% and increased 22% year over year. Revenues climbed 8.1% year over year to $3.12 billion but missed the consensus mark of $3.18 billion by 2%. The 12-month backlog increased 8.8% to $8.99 billion. J.B. Hunt Transport Services, Inc. JBHT reported third-quarter 2026 earnings of $1.82 per share, up 3.4% from $1.76 a year ago. The figure beat the Zacks Consensus Estimate of $1.81 by 0.6%. Operating revenues climbed 20.4% year over year to $3.68 billion and surpassed the consensus mark of $3.56 billion by 3.2%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Union Pacific Corporation (UNP) : Free Stock Analysis Report J.B. Hunt Transport Services, Inc. (JBHT) : Free Stock Analysis Report Alaska Air Group, Inc. (ALK) : Free Stock Analysis Report Wabtec (WAB) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Norfolk Southern Corporation NSC reported impressive third-quarter 2026 results, wherein both earnings and revenues beat the Zacks Consensus Estimate. Quarterly adjusted earnings (excluding 25 cents from non-recurring items) of $3.62 per share surpassed the consensus estimate of $3.48 by 4% and increased 9.7% year over year. Railway operating revenues of $3.53 billion beat the consensus estimate of $3.46 billion by 1.8% and increased 13.6% year over year to a quarterly record. The improvement was driven by higher fuel surcharge revenues, 3% volume growth and improved revenue per unit. Norfolk Southern Corporation price-consensus-eps-surprise-chart | Norfolk Southern Corporation Quote Total railway operating units increased 3% year over year to 1.85 million. Revenue per unit rose 11% to $1,902. Fuel surcharge revenues surged 125% to $468 million. Excluding fuel surcharges, revenues increased 6% year over year to $3.06 billion, while revenue per unit improved 3% to $1,650. Merchandise revenues increased 11% year over year to $2.19 billion, supported by 3% unit growth. Revenue per unit improved 8% to $3,579. Chemicals revenues rose 16% to $658 million, metals and construction revenues increased 15% to $516 million, and agriculture, forest and consumer products revenues grew 10% to $696 million. Automotive revenues declined 1% to $318 million. Intermodal revenues jumped 21% year over year to $919 million, with units increasing 3%. Domestic intermodal units grew 10%, while international units declined 8%. Coal revenues increased 12% to $419 million, supported by 3% unit growth. Export coal tonnage increased 10%, while utility and domestic metallurgical coal tonnage declined 2% and 8%, respectively. Adjusted railway operating expenses increased 17% year over year to $2.31 billion. Fuel expenses surged 77% to $420 million, while adjusted compensation and benefits expenses rose 5% to $753 million. Purchased services and rents expenses increased 5% to $546 million. Adjusted income from railway operations increased 7% to $1.22 billion. However, the adjusted operating ratio (operating expenses as a percentage of revenues) deteriorated 210 basis points year over year to 65.4%. Train speed declined 5% year over year to 20.9 miles per hour, while terminal dwell increased 4% to 23.2 hours. However, train speed improved 5% sequentially, while terminal dwell improved 3%. Workforce productivity increased 5% year over year. Merchandise plan compliance declined to 74% from 80%, while the intermodal service composite fell to 84% from 92%. NSC exited the third quarter with cash and cash equivalents of $1.60 billion compared with $1.53 billion at 2025-end. Long-term debt declined to $15.96 billion from $16.48 billion. Operating cash flow for the first nine months of 2026 declined to $2.72 billion from $3.30 billion a year ago. Property additions totaled $1.41 billion, while dividend payments amounted to $910 million. Norfolk Southern raised its 2026 adjusted operating expense forecast to approximately $9 billion from its original guidance of $8.2-$8.4 billion, reflecting approximately $700 million in incremental fuel costs and higher volumes. Capital expenditures are now expected to be approximately $2.1 billion, remaining below the 2025 level. Management continues to prioritize safety, reliable service and disciplined cost control. Currently, NSC carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Alaska Air Group, Inc. ALK reported third-quarter 2026 adjusted earnings of 36 cents per share, excluding certain tax impacts, beating the Zacks Consensus Estimate of 35 cents by 2.9%. The company had reported adjusted earnings of $1.05 per share a year earlier. Higher fuel expenses weighed on profitability despite strong revenue momentum. Operating revenues increased 14.4% year over year to $4.30 billion but missed the consensus mark of $4.31 billion marginally by 0.1%. Wabtec Corporation WAB reported mixed third-quarter 2026 results, wherein earnings surpassed the Zacks Consensus Estimate, but revenues missed the same. Quarterly earnings (excluding 41 cents from non-recurring items) of $2.83 per share beat the Zacks Consensus Estimate of $2.72 by 4.04% and increased 22% year over year. Revenues climbed 8.1% year over year to $3.12 billion but missed the consensus mark of $3.18 billion by 2%. The 12-month backlog increased 8.8% to $8.99 billion. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Norfolk Southern Corporation (NSC) : Free Stock Analysis Report Alaska Air Group, Inc. (ALK) : Free Stock Analysis Report Wabtec (WAB) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Alaska Air Group just dropped its Q3 2026 scorecard and the first move was emotional, not analytical. The stock slipped about 2.4% today after closing yesterday down roughly 20% over the past month. Traders are reacting to a fresh quarterly loss and a headline adjusted earnings per share of $0.36 on US$4.3b in revenue, while the share price already reflects a long stretch of red ink. The real story is a clash in sentiment. Strong revenue per seat and an 82.8% passenger load factor signal healthy demand, yet the market is treating fuel driven losses as a verdict on the entire Alaska Air Group recovery effort. Love the resilient demand and revenue strength at Alaska Air Group but concerned about recurring losses and fuel driven pressure on profits? Take a look at our screener of companies that pair strong fundamentals with healthier balance sheets in the list of solid balance sheet and fundamentals stocks (25 results) - Revenue (Q3 2026 vs. Q3 2025): US$4,308 million vs. US$3,766 million (up about 14%) - Net Income/Loss (Q3 2026 vs. Q3 2025): loss of US$147 million vs. profit of US$73 million (swung into a loss) - Basic EPS (Q3 2026 vs. Q3 2025): loss of US$1.32 per share vs. earnings of US$0.63 per share (moved from profit to loss) - Passenger Load Factor (Q3 2026 vs. Q3 2025): 82.8% vs. 84.8% (slightly lower seat utilization) Prefer clean, visual charts over another wall of earnings tables and footnotes? See Alaska Air Group's full financial picture, including a clear view of its recent profitability trends, in the interactive company report for Alaska Air Group. The upbeat view centers on Alaska Air Group turning premium, loyalty and cargo into a sturdier profit engine over time. "Bullish analysts expect Alaska Air Group to convert its growing international network, loyalty and co‑brand card earnings, premium cabins and cargo build‑out into a larger, more diversified earnings base over time." Q3 shows early progress. Premium revenue grew far faster than system sales and now accounts for more than 36% of the top line. Loyalty cash remuneration reached US$721 million, up over 20%. Cargo income rose 9%. Those gains helped widen the spread between revenue per seat and non fuel costs by about 7 points, even though high fuel costs still pushed the quarter to a net loss. One Narrative disagrees with today's price. → See where this Narrative says Alaska Air Group should trade. Bearish research argues Alaska Air Group's premium and loyalty push cannot overcome fuel shocks and heavy investment. "Although Alaska Air Group is increasing revenue from premium cabins, loyalty and cargo, recent adjusted net losses of $192 million in Q1 2026 and $102 million in Q2 2026 highlight that a sharp spike in jet fuel costs can outweigh this diversification." Q3 results keep that concern alive. The business swung to a GAAP loss of US$147 million despite 14% revenue growth and a stronger premium mix. Management now guides to an adjusted loss of US$5.00 to US$5.50 per share for 2026 and calls out roughly US$650 million of extra Q4 fuel expense. This indicates that the diversification gains are not yet offsetting fuel and capital intensity. Alaska Air Group shows how strong demand can sit alongside headline losses and volatile share prices. The real opportunity sits in finding stocks that could be undervalued before valuation gaps potentially narrow. - Company 1 - 46% below our estimate - expands a Pacific banking footprint by integrating an acquisition and emphasizing low cost deposits and conservative credit culture. - Company 2 - 33% below our estimate - uses a large super app client base to deepen secured, higher yielding credit while keeping risk costs contained. - Company 3 - 28% below our estimate - builds digital infrastructure chips and software that manage how data is processed, moved, connected, secured and governed across systems. That is three of the list. See all 33 potentially undervalued companies → This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include ALK. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. - Management attributed the third quarter GAAP net loss primarily to unprecedented fuel prices, which are projected to add $1.8 billion in costs for the full year. - The company is transitioning from building a foundational infrastructure to harvesting value through four strategic pillars: premium products, international expansion, loyalty, and cargo. - Diversified revenues reached 54% of the total mix, a strategic shift intended to make earnings more resilient and less dependent on fuel price fluctuations. - Premium revenue grew to 36% of the total mix, driven by robust demand and the completion of narrow-body premium retrofits across the fleet. - International growth in Seattle is a core focus, with plans to become the city's leading long-haul international carrier by 2030 through new routes to Osaka and Tahiti. - Managed corporate revenues increased 30% year-over-year, reflecting significant share gains across both business and large lease agencies. - Management emphasized that current results do not reflect the business's earning potential in a stable macro environment, citing a 7-point RASM to CASM ex spread as evidence of underlying strength. - The company expects at least $3 to $4 of core earnings improvement in 2027, assuming the maturation of strategic growth markets and international franchises. - Fourth quarter unit revenue is projected to remain strong, up low double digits, supported by continued momentum in premium and corporate travel. - Capacity growth is expected to moderate to approximately 1% to 1.5% in the fourth quarter, with the majority of growth allocated to international routes. - Management assumes a fourth quarter economic fuel cost between $4.65 and $4.85 per gallon, a significant headwind compared to initial 2026 planning. - The company plans to join Atlantic and Pacific joint international businesses to leverage global partner distribution and strengthen international economics. - Strategic growth markets and international long-haul expansion created a combined 4-point drag on unit revenues during the quarter as these routes mature. - Hawaii operations faced a 2-point unit revenue headwind due to industry capacity growth and the lingering effects of unusual weather events. - The company maintains $3.3 billion in liquidity and $20 billion in unencumbered assets, prioritizing balance sheet restoration as earnings improve. - Management acknowledged that while share buybacks were intended to be accretive, the unconventional fuel environment may lead to a more conservative cash approach in 2027. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. - Management expects meaningful improvement in year 2 yields and loads as capacity in strategic markets like San Diego and Portland matures. - International routes currently act as a 1-point drag on unit revenue, but load factors increased 7.5 points in Q3, indicating strong demand ramp-up. - Management stated that if fuel remains structurally higher, the industry will eventually have to react through pricing to fully recover costs. - The strategy to increase diversified revenue to 60% is specifically designed to raise the earnings floor against oil shocks and other macro factors. - The company expects 22 deliveries next year starting in late Q1 following the recent certification of the MAX 10. - Initial deliveries will feature standard domestic configurations, with the 'Aurora' lie-flat seat configuration debuting in 2028. - Optimism for 2027 is driven by constructive industry capacity trends, with mainland-to-Hawaii capacity expected to be down over 4% in Q2 2027. - The transition to a single passenger service system (PSS) in April has removed operational friction and improved connectivity with OneWorld partners.

Image source: The Motley Fool. Wed, Oct. 21, 2026 - Vice President of Finance, Planning, and Investor Relations - Ryan John - Chief Executive Officer - Benito Minicucci - Executive Vice President and Chief Commercial Officer - Andrew R. Harrison - Executive Vice President and Chief Financial Officer - Shane R. Tackett - President of Alaska Air Cargo - Jason Matthew Berry Operator: Good morning, ladies and gentlemen, and welcome to the Alaska Air Group 2026 Third Quarter Earnings Call. At this time, all participants have been placed on mute to prevent background noise. Today's call is being recorded and will be accessible for future playback at alaskaair.com. After our speakers' remarks, we will conduct a question and answer session for analysts. I would now like to turn the call over to Alaska Air Group's vice president of finance, planning, and Investor Relations, Ryan John. Ryan John: Thank you, operator, and good morning. Thanks for joining us today to discuss our third quarter 26 earnings results. Yesterday, we issued our earnings release detailing our results. Which are available at investor.alaskaair.com. Today, you will hear updates from Benito, Andrew, and Shane. Several others of our management team are also on the line to answer your questions during the Q and A portion of the call. Air Group reported a third quarter GAAP net loss of $147 million or $1.32 loss per share. Excluding special items and the impact of a revised tax rate, adjusted net income was $40 million and adjusted earnings per share was $0.36 As a reminder, forward-looking statements, future performance may differ materially from our actual results. Information on the risk factors that could affect our business can be found within our SEC filings. We will also refer to certain non GAAP financial measures such as adjusted earnings and unit costs excluding fuel. And as usual, we have provided a reconciliation between the most directly comparable GAAP and non GAAP measures in today's earnings release. Over to you, Benito. Benito Minicucci: Thanks, Ryan, and good morning, everyone. Just a few weeks ago, we laid out the next chapter for Alaska Air Group and our path to becoming a larger, more diversified, and more resilient business. Our third quarter results reinforce our confidence in that strategy. Despite unprecedented fuel prices that are adding $1.8 billion in cost this year and pressuring our profitability. Demand remains healthy. Revenue performed in line with our expectations. And we continue to execute across our initiatives in premium, loyalty, cargo, and international. All helping to drive a 7-point RASM to CASM ex spread for the quarter. Up from 2 points in Q2. We continue to see strong momentum across the 4 strategic growth areas we highlighted at our Investor Day. We said the first chapter of Alaska Accelerate was about building the foundation and the next chapter was about harvesting the value from it. That transition is underway. The investments we have made over the last several years are driving greater scale, deepening our relevance with guests, and strengthening loyalty across our geographies. Diversified revenues now represent 54% of our total mix, up 4 points from last year and 1 point from last quarter. As this mix continues to grow, our earnings will become less dependent on fuel, and more resilient. Premium demand remains robust with revenues reaching more than 36% of our total mix, up 3 points year over year. That reflects the strength of our products and our growing relevance across the West Coast and beyond as we build toward our 40% target by 2030. Our international franchise in Seattle is growing rapidly. We are excited to announce that next spring, we will launch year round service from Seattle to Osaka, Japan, and Papeete, Tahiti. That brings our nonstop international routes out of Seattle to 9 as we build toward 15, and our goal of becoming Seattle's number 1 long haul international carrier by 2030. And we see even more opportunity ahead as we prepare to file with the DOT to join the Atlantic and Pacific joint international businesses in the coming weeks. Loyalty program cash grew 21%, another strong indication that the investments we are making are driving greater relevance and deeper loyalty with our guests. And lastly, cargo revenue grew 9%. We are optimistic about growing this business to a more meaningful level as we deploy our new 37 freighters in Alaska and Hawaii next year and work toward renewing our partnership with Amazon with better economics and expanded service. Our focus remains on the things we can control. As we are demonstrating, those things continue to move in the right direction. We know we can do better than the results we are producing today. that is precisely why we are focused on the areas of the business we believe will drive higher and more resilient earnings over time. Premium, international, loyalty, and cargo are the path forward, and increasingly, we will see the investments we have made over the last several years translate into tangible results across the business. And we are doing it with a team that is engaged, energized, and excited about the future. I want to thank our employees for their continued commitment to our guests and to 1 another. Their dedication makes everything we are accomplishing possible. And it gives me tremendous confidence in the opportunities ahead. And as we look to our next chapter, we are excited to welcome Amaresh Siva, our new chief information technology officer. He brings deep experience and strong leadership to the role. And I know he will be an important partner as we continue to build the capabilities that will support Air Group's future. We have a lot of work ahead of us, but I am confident in our strategy and in this team. Now it is about execution, and delivering the results. Andrew, over to you. Andrew R. Harrison: Thanks, Benito, good morning, everyone. Today, I will walk through our third quarter financial performance, near term demand and revenue, and the ways we are continuing to diversify and strengthen our revenues as part of Alaska Accelerate. In the third quarter, total revenues of $4.3 billion, up 14% year over year while capacity grew 2.4%. Unit revenue increased nearly 12% in line with our expectations of low double digit growth. Yield for the quarter grew 13.4%, with strong sequential improvement each month from 11% in July and finishing with a particularly strong September up approximately 17% year over year. We achieved this result despite several factors in impacting our coupon unit revenues which we believe are temporary in nature. Including approximately 3 points of pressure from strategic growth markets we outlined at Investor Day, which represent about 13% of our capacity and are growing more than 20%. As this capacity matures, like trends we have seen in San Diego, we expect meaningful improvement in year 2 yields and loads along with loyalty and corporate market share. Another 1 point of pressure from the rapid growth of our international long haul flying. We expect this dynamic will continue near term as we add new routes but we are encouraged by the progress we are seeing. And as our international franchise matures, we see a clear opportunity to improve performance. And a continued 2-point headwind from Hawaii, excluding which, where we undertook double digit capacity growth which is included in my first point. As improvements in this market have been outpaced by those across the rest of the system. As we discussed before, this is 1 market where our competitive advantage is clear, and differentiated. And 1 of the reasons we remain confident in Hawaii over the long term is that no 1 is more invested in the market. The big 4 have less than 4% of their network invested. nor understands the travelers and their unique needs better than we do. Just as we have demonstrated in Seattle, our sustained focus and leadership have built a competitive advantage that is difficult to replicate and will only strengthen over time. To summarize, today, over 40% of our system is absorbing 6 points of unit revenue pressure that we do not expect to persist long term. Many of these investments across the network are necessary to increase our West Coast passenger share, capture more premium and corporate demand, and drive industry leading loyalty in our geographies. As our growth annualizes and international markets mature, we see real opportunity for improvement starting in 2027. Premium traffic remained 1 of our strongest revenue performers, growing approximately 24.5% year over year and reaching more than 36% of total revenue. that is up 3 points versus last year. With our narrow body premium retrofits complete, we will capture the full annualized benefit next year. And we still have meaningful runway ahead as we expand premium offerings across our wide body fleet over the next few years. Giving us confidence in our path towards a 40% premium revenue mix and the earnings opportunity that comes with it. Managed corporate revenues increased 30% in the third quarter. And future bookings are also running approximately 30% above prior-year levels. Reflecting share gains across both business and large lease agencies. For London Heathrow, our business class cabin performance exceeded our fair market share by 3 points in the third quarter, demonstrating our ability to convert our strong domestic corporate performance into international share as we grow our international footprint and expand our premium portfolio, making us a more relevant partner and creating meaningful long term share opportunities. proof points that our strategy is working. Loyalty continues to be 1 of the strongest performers. Program cash remuneration of $721 million increased 21% during the quarter. Supported by strong card spend and continued engagement across the ecosystem. We are particularly encouraged by the performance of our premium Summit card. Just 1 year after launch, roughly half of cardholders are new to our portfolio, 40% come from outside our core geographies, and international spend is running several times higher than the rest of the portfolio. Although the strength of that card product launch creates a year over year headwind for us in the fourth quarter, we still anticipate strong annual program cash growth through 2030. In line with the targets we shared a few weeks ago. Looking ahead to the fourth quarter, the demand environment remains healthy, supported by continued strength in pricing and yield trends across much of the network. Helicopter yields for the. Each month in Q4 are currently up double digits versus last year. We expect capacity growth to moderate to approximately 1% to 1.5% year over year with most of that growth coming from international. With continued momentum across premium and corporate travel, we expect fourth quarter unit revenue performance that is broadly in line with the strength we saw in the third quarter. Up low double digits. To close, the commercial strategy we laid out at Investor Day is working. We have built tremendous scale and unrivaled leadership across the West Coast, and we are translating that scale into greater relevance through a more global network stronger premium products, and deeper loyalty. And importantly, there is significant opportunity ahead as our international franchise matures. We refine our revenue management capabilities and complete our product offerings to fully serve our guests. While fuel remains a significant near term headwind, it does not change our confidence in the strategy for the longer term opportunity ahead. And with that, I will pass it to Shane. Shane R. Tackett: Thanks, Andrew, and good morning, everyone. As Ben covered, and is well understood, our third quarter results were significantly pressured by the current fuel environment. Where we saw prices range from approximately $3.10 in early July to nearly $5 as we exited the quarter. The underlying business model transformation we are undertaking, however, is gaining traction with premium, international, loyalty, and cargo all contributing meaningful year over year revenue growth in the quarter. We are both committed to and confident in our strategic direction. And we will remain focused on delivering a structurally stronger business model in which earnings are more resilient over time. We ended the quarter with approximately $3.3 billion of liquidity, and continue to maintain significant financial flexibility with $20 billion in unencumbered assets. Debt-to-capitalization remained stable at 66%, and as we improve earnings and generate free cash flow, restoring the balance sheet will be our top financial priority. Turning to third quarter performance, non fuel unit costs increased 4.4% year-over-year on only 2.4% capacity growth, in line with guidance. This was a strong sequential improvement from the 6.5% unit cost increase we saw in the second quarter. We continue to have opportunity to further optimize and lean out the business as we move through operational integration milestones and we are also focused on flying closer to our original capacity plans going forward as the operation benefits greatly from predictability in our schedules. Moving to fuel, Our average price was $3.94 per gallon during the quarter. Above our original July guidance of $3.75 driven by higher crude and refining costs. Fuel has continued to move higher into the fourth quarter, We did see West Coast refining margins below Gulf Coast margins during September while Singapore refining margins and fuel pricing have returned to being our lowest cost source in our network. Given recent trends, we expect our fourth quarter economic fuel cost to average between $4.65 and $4.85 per gallon. This versus our initial plan of $2.50 per gallon entering 2026. The more than $2 of additional per-gallon cost is adding $650 million of expense to the business in the fourth quarter. As Andrew noted, capacity is sequentially lower in the fourth quarter increasing 1% to 1.5% year-over-year. This growth level is over 2 points below our original plan for the year and includes reductions we made to the schedule within the past 2 to 3 months. The past 6 years have seen a trend of planning capacity higher than what we have flown, almost entirely due to external events. That pressures unit costs and is a phenomenon we are focused on reversing as we move into 2027 and beyond. We expect nonfuel unit costs to grow mid-single digits in the fourth quarter against our capacity growth of less than 1.5%. This is consistent with what we have shared in the past regarding baseline in the business of 4% to 5%, Which requires similar capacity growth to fully offset. Cost drivers include higher airport and real estate costs, as well as additional engine maintenance expenses consistent with what we see through the rest of the industry. We are encouraged by the improved spread between unit revenue relative to unit cost. We generated approximately 5 points of sequential RASM to CASM ex spread improvement in the third quarter and expect a healthy positive spread to persist into the fourth quarter. This is evidence that the commercial investments we are making are helping drive greater RASM as we progress toward our targets and translate those initiatives into higher earnings over time. Taken together, we expect to produce a fourth quarter adjusted loss per share of between $2.50 $2.00, and that includes a more than $4 fuel headwind versus our original assumption. For the full year, we now expect an adjusted loss per share of between $5.50 $5.00. As we outlined at our Investor Day, we are focused on building a business with more ways to generate earnings by building on our strong operational performance, safety and care, growing higher margin revenue streams, maintaining our cost performance, and restoring balance sheet strength. We are already seeing progress in the underlying business, with our diversified revenue mix reaching 54%, up 3 points from last year. The foundation is built Our focus now is on fully turning that progress into stronger earnings and cash flow. And regardless of fuel, we are confident in at least $3 to $4 of core earnings improvement next year. To close, the earnings we are producing today are not indicative of what we expect the business to earn in a stable macro environment. Higher fuel is creating a significant near term headwind and we remain in the midst of a significant business model transformation that will produce higher unit revenues while we also drive more efficiency in our unit cost structure. With that, let's go to your questions. Operator: At this time, I would like to invite analysts who would like to ask a question to please press star then the number 1 on your telephone keypad. And our first question will come from Mike Linenberg with Deutsche Bank. Mike Linenberg: Yes. Hey, good morning, everyone. I want to just call out in your release this pressure from strategic growth market investments and presumably that is the ramp up of these international markets. I know you are at 9 now. You have announced 9 and are flying a little bit less than 9, and you are on your way to 15. How long does it take to ramp those up to maturity to get to profitability? And as sort of a part of that, Andrew, you called out this, call it market share outperformance in the Heath Row market. I think you said 3 points. Is that volumes or is that actually a revenue number? Thanks for taking my question. Andrew R. Harrison: Thanks, Mike. A couple of things. Firstly, the, of the 6 points I just shared in my prepared remarks, the growth that I am referring to and 3 points of it is actually the markets that we grew 20-plus percent in. And that is going to be your Portland's and San Diego's and Los Angeles and even some California, Hawaii markets. And, again, we have seen great loyalty growth great strength in corporates, and all the rest of it. So that is good growth, and that is what we sort of unpacked on Investor Day. On the international we shared, that was about 1 point. Okay. Of drag. Even that said, we saw a 7.5-point increase in load in the third quarter from our international, and our unit revenues were up 24%. So in the near term, it will continue to be a drag. Just to be clear on the international and the London specifically, that is our fair share of the front premium cabins, and we had a premium. And that is very exciting for us to see, which fits our thesis that people from Seattle and connecting into Seattle on our long haul, they wanna fly with us. Mike Linenberg: Great. Thanks for the clarification. Andrew R. Harrison: Thank you. Hey. Ryan John: Thanks, Mike. Operator: And our next question will come from Ravi Shanker with Morgan Stanley. Ravi Shanker: Great. Thanks. Good morning. So the new international routes that you guys have ramped up obviously include a fair bit of fuel pass through in the current pricing. Are you confident that can be the new baseline going forward ifwhen fuel normalizes as well? And kinda how are you thinking about the kind of unit economics there over time? Andrew R. Harrison: You know, I think hi, Ravi. I think, you know, international, just like domestic or any other is basically gonna be dictated, by obviously the fuel cost and then demand. And, you know, you can add all the sorts fuel charges if you want, but at the end of the day, we need to see continued strength in demand. And as I shared earlier, the good thing about where we are coming from is that we are just seeing nothing but ramping and upside as we get better about selling domestically and internationally, the connections, the product that is coming, the joint businesses that are coming. So we feel very good about the platform that we are we are growing from on the international basis. Ravi Shanker: Great. Thank you. Ryan John: Thanks, Ravi. Operator: And we will move next to Jamie Nathaniel Baker with JPMorgan. Jamie Nathaniel Baker: Hey, good morning, everybody. So for the fourth quarter, it looks like you trimmed about 2 points of flying. You know, from a 1-time plan. Internally, what sort of financial metric do you use in deciding when to add that back? I mean, it is it is obviously marginal flying. You may characterize it as utilization flying. So I assume that internal hurdle is different than me just, you know, looking at the output in my earnings model for example. Shane R. Tackett: Yeah, hey, Jamie. Thanks for the question. I think number 1, I would just say. And as we mentioned it in the prepared remarks. I think increasingly, we are focused on flying what we plan to. it is the best thing for the company long term, best thing for the operation. Once we structurally get ready to fly a certain schedule, it is it is hard to shift costs out if we are making cuts close in. Think in terms of, like, once we have made some fringing to the schedule when planes come back, it. there is actually many layers to that. We have a lot of investments we are making into the into the fleet with things like Starlink. And, obviously, this year, we went through incremental, additions in the first class cabin and the PC cabin. And then on the wide body fleet, we are gonna start putting premium reserve in and, remodeling the front of those cabins as well. So once we decide that we are gonna free up an aircraft or a line of aircraft, we tend to not just put them on the ground and let them be lazy spares. We go do something with them on the investment side or the maintenance side. So it is not just a pure sort of, like, internal economic exercise. Certainly, if we see demand kind of surge back in a way that a market needs more capacity, have a lot of flexibility to move planes around and match that capacity. Jamie Nathaniel Baker: Okay. I get it. I asked in kind of a clunky way, but that makes it clear. And then second, you know, like, it is hindsight, but you know, the share repurchase program, obviously, has not worked out particularly well given your elevated leverage. You know, I assume you may have some regrets in that regard. You can comment on that if you want. But, you know, more importantly, what. what is the lesson here? I mean, does this imply more prudent capital allocation going forward? Benito Minicucci: Hey, Jamie. You always ask great insightful questions. Look, I think if we had you know, a crystal ball in the future and could have predicted where fuel prices are gonna go, yeah, I think we would have thought about the share buyback differently just to be honest. And even as we go with the next year, we will see what the price of fuel is, and we will use the share buyback that is planned as perhaps conserving that cash for next year just to be totally honest and candid. So, I think in a normal environment, this would have been very accretive. I think if, again, given the earnings that we had planned both in 2025 and 2026, I think this would have hugely accretive. The last 2 years have been unconventional, as you know, covering the industry so many years. So but going forward, I think at the end of the day, we are optimistic that, you know, if we drive the earnings that we are gonna have fuel will have to normalize to a certain level. The investments we are making across those 4 pillars we talked about, I think, will put us in a good position. And I think we will not regret having bought back Emily, I do not know, what, 20 million shares. I think at the end of the day, we are not gonna regret buying back 20-million-some-odd shares. You know, as we head into 2027 and 2028. Jamie Nathaniel Baker: Okay. Thanks, Benito. I appreciate it. Take care. Ryan John: Alright. Thanks, Catherine. And sorry. We missed you at investor day. Operator: And we will now move to our next question. That will come from John Dewey Dorsett with Citigroup. John Godden: Hey, guys. Thanks for taking my question. In the prior question there from Jamie, Benito, I heard you use the phrase normal environment. And it kind of sounds like normal is lower fuel prices. There are other airlines out there describing normal as a new normal, of perpetually higher fuel prices. And I was just hoping to kind of reflect on that for a second. At the Investor Day, you guys had a very wide range on your forward EPS. But maybe you can talk about how if we find ourselves in a new normal, with higher for longer fuel, what adjustments could be made to kind of protect earnings and kind of hit the outlook that you guys offered? Benito Minicucci: I will start, and then I will hand it over to Shane. And, John, it is a great question. I. You know, what we unveiled at Investor Day was a strategy to allow the company to be more resilient to not only oil shocks, but other economic shocks like tariffs And, and so the investments we are doing in a premium and international you know, in the loyalty benefits we are gonna get and cargo, those are gonna really raise the earnings floor and have us become less vulnerable to these external shocks. So I think it is it is that strategy that is gonna. You know, as it is ramping up here over the next 2 years, that is really gonna help us whatever that new normal is. Now, like, nobody knows what that new normal, is gonna be, and we try to give you a range at Investor Day. But we feel confident that with our plan that once there is a new normal, that Alaska is gonna be a winner, in this industry. Shane, I do not know if you want to put any more context on Shane R. Tackett: That was perfectly said. The thing I would just add is for the longest time at the company, I think we planned sort of fleet economics on $3 of fuel,, market economics on $3 of fuel,, for 5 or 6 years, we paid $2.50. So, we are not we are not really here to predict what is gonna go on in that part of the market. I think, as Benito said, we are gonna build a business that can be responsive to whatever type of fuel environment we see, over the long term. John Godden: Okay, guys. Appreciate that. And if I could just ask a nit here on, the 737-10, you know, was recently certified. You guys had to kinda juggle a little bit during the investor day, amid a lot of uncertainty about it. I recall you guys saying, you know, however this plays out, it does not really change our fleet plan. Given that it was just certified, maybe we. You can just kinda remind us when do you expect first delivery? what is the latest thinking? And any update on the fleet plan in light of that? Thank you. Benito Minicucci: Yeah, thanks, John. Hey, I was at the certification ceremony yesterday. It was a thing of beauty. Actually, that 10 max, just looking at it, looks fantastic. It does--it looks like a. it is gonna be a great looking airplane out on the tarmac. You know, next year, we are going to have 22 deliveries. We plan to start taking them, sometime late in the first quarter and so that. And so just to remind you, the first tranche of airplanes are gonna be in our standard domestic configuration. And then in 2028, the second tranche is gonna be in what we call our Aurora configuration with the lie flat seats, which we are really excited about. So right now, you know, all systems are go next year in terms of delivery. 30 MAXs. That will fit beautifully into our fleet. Thanks, guys. John Godden: Appreciate it. Ryan John: Thanks, John. Operator: And we will move next to Savanthi Syth with Raymond James. Savanthi Syth: Hey, good morning. Ryan, Andrew, just following up on the kind of the pressures that you called out. I understand that kind of the long haul rapid growth there. That pressure will continue for some time here. But I am curious how you are thinking about kind of the forward of, like, the 3 points from strategic. Growth markets. When does that subside? And on Hawaii, when does that either subside or you start to anniversary? Yeah. Andrew R. Harrison: Thanks, Savi. So a couple of things. The growth that we saw this year on the call will annualize going into next year and start materially annualizing as we get into the second quarter and beyond. We have core growth next year of a couple of points, that is all gauge. On the dash tens that Benito just talked about in international, which we believe is solid growth. But Hawaii, just to touch on that, and if you know, it is been a challenging year for Hawaii as we all know, but, I have real optimism, for 2027, and there is really 3 reasons for that. The first 1 is I do not really expect multiple generational storms that impacted Hawaii, and we actually had negative unit revenues in the second quarter and the third quarter. From the West Coast to Hawaii. But, you know, I am looking at 2027 right now and even in January and February, which is early days. I am seeing double digit unit revenues there. So that is headed in the right direction. Secondly, as you know, we transitioned to a single PSS in April, and that got rid of all sorts of friction. Connectivity challenges, and Hawaiian brand joined the 1 world. And then the third area is industry capacity. Is appearing constructive as I sit here today. The industry actually grew mainland capacity to Hawaii by 6% this past year,, which is very significant. But as I look into the next year, Q1, it is up, about 1.9%, and second quarter, it is actually down over 4%. So as we stand back and look at Hawaii and our No. 1 utility market share departures nonstops, premium seats, we feel like the setup for Hawaii next year with the annualization of, obviously, our growth markets, and, you know, we feel optimistic. Savanthi Syth: that is helpful, Andrew. Can I ask just on the fourth quarter guide, you know, low double digits means, like, a similar RASM as the third quarter? But you are having slower capacity growth. Is that just a tougher comp that is being reflected there Or is there something worsening somewhere or some seasonality in international that is kind of causing that? Right. Andrew R. Harrison: I actually appreciate you asking that, Savi, because that is an important note is if you look at our bulk coupon revenues, actual passenger fares paid, they are actually continuing to accelerate into the fourth quarter. So we had sort of, like, 3 points from Q2 to Q3, and Q3 to '4, our coupon is actually accelerating nearly 3 points. What is being masked with a little bit is a comp issue and noise as you suggest When we launched Atmos last year, it was a huge launch. Both the Summit card and the Ascent card And so there was, and there is also some movement in some of the loan bonuses. So bottom line is there was--there is a headwind, in the fourth quarter just on the on the annualization of the Atmos launch, but the core coupon business continues to accelerate into the fourth quarter. Savanthi Syth: Very helpful. Thanks. Ryan John: Thanks, Savi. Operator: And our next question will come from Atul Maheswari with UBS Securities. Atul Maheswari: Good morning. Thanks a lot for taking my question. Shane, you talked about normalized capacity next year. So in that backdrop, what is the realistic CASM ex growth rate to expect for next year? What is your expectation around inflation? And then what are some of the other puts and takes around nonfuel costs? For next year that we should be mindful of? Shane R. Tackett: Thanks, Atul. I will. I will steer clear of, like, guidance, but we will talk about sort of some of the components. And I think we have been open about these over the last several calls. And we wanna get to, you know, over time, a growth rate that is in the 4% range. I think that is very consistent with what we have said for a while. But I think we have been sharing for a couple of years, core inflation is 4% to 5%. There are years that it could be accelerated. There might be years it is slightly less. But that seems to be kind of a new normal in the in the airline industry across the industry. Same drivers as everybody else. Labor has been a part of that. Airport cost investments. Which largely are needed and enhance the guest experience are part of that. And then engine maintenance costs are part of that as well. So those are the basic components as we start to think about capacity relative to cost growth in the company. That are gonna drive most of the unit cost narrative. What you will see from us, now that we are getting further through the integration milestones, and you have seen it this year, we actually have a over quarter, and we are starting to be able to more optimize where we can. And we will focus on the same things we always have productivity, across every component of the business. Utilization of the aircraft fleet are gonna be important things for us to focus on. We are gonna make investments in the strategy going forward, things that we need to do to enhance the guest experience and really earn the premium fares that we are expecting to as we as we go down the path of further premium, further international, and, further investments in the loyalty program and base. So those are the basic components. We will we will get, you know, more specific guides out to you guys in January on that call. Atul Maheswari: Great. Thanks for that. it is very helpful. And then just as my second question, which is around CapEx, the plan I think that you laid out at the Investor Day is around $1.9 billion for next year. The question I have is that do you have flexibility to push it lower in case fuel is simply higher for longer and that is a drag on the free cash in the near term. And then just overall, how were you thinking about balancing near term balance sheet leverage versus the long term investment needs for the business? Shane R. Tackett: Yes. Thanks, Atul. To answer the first question, we have flexibility. We have got a phenomenal partner in Boeing. We have never run into a situation where they were not willing to work with us. If we needed to and vice versa. We support each other. So, we intend to take all of the aircraft, I think, on a on a just aircraft over aircraft basis, the MAX 10 is much more fuel efficient. Higher gauge, better financial performer than the 737-700s that they will ultimately replace as those retire. And then, obviously, the 787s are really key to the, build out of the international strategy. So those are. We are we are still looking to continue to invest in the strategy and both Benito and I mentioned that in the prepared remarks. We have, a lot of focus on the balance sheet. The debt to cap is 66%. it is still relatively healthy. We wanna--we want to get that back down going the other direction. In terms of leverage, just so you all know the math, 75¢ of fuel price, is worth 4 turns of leverage or something like that, 3 to 5 turns of leverage in the business today. So it is it is very correlated with fuel price can turn very, very quickly. In terms of managing liquidity and overall sort of debt, on the balance sheet, we have not made decisions entirely about how we are gonna finance the company next year. We have traditional you know, access to traditional debt methods, mortgage debt, capital markets if we wanna go that route. We can do sale-leasebacks. there is all--there--there are other terms of alternative, financing available to us. So we will be deliberate about that. We will we will we will be thinking about that over the next couple of months as we finalize our plans. But I think the thing I would leave everybody with is we are really focused on maintaining the core discipline around financial, or balance sheet discipline. In the near and long term. And our first financial priority is earnings turn and cash flows turn, is to restore balance sheet strength to our targets. Atul Maheswari: Great. Shane you for that and good luck with the fourth quarter. Ryan John: Thanks, Atul. Operator: And our next question will come from Duane Pfennigwerth with Evercore ISI. Duane Pfennigwerth: Hey, thank you. So you touched on Hawaii. Some very weird unusual weather this year, abnormal weather. Elevated industry supply, which sounds like it is correcting a bit. If we think about the entirety of Hawaii headwinds to this year, how would you size the headwind either in system RASM points or total pretax? Andrew R. Harrison: Hi, Duane. Yeah. I think you know, it is consistent with what it is been through the year. I think at the highest level, a couple of points. On the unit revenues for Hawaii would be where we would baseline it. But again, as I have shared, I think there is some real constructive setup for next year. And, also, we are a lot smarter. You know, when challenging times hit and things happen, causes the teams to double down and really look hard. And we have sharpened the pencil on all the critical elements of the Hawaii franchise. And so we have got a lot of things in the hopper, and so we feel very ready for next year. Duane Pfennigwerth: Thanks. Just to check that, that is 2 points to system. Andrew R. Harrison: Yes. Yep. Duane Pfennigwerth: Great. And then with the greater segmentation of your credit card portfolio and the premium lounges that you highlighted at your Investor Day, I just wonder when you would expect contribution from those maybe more premium co brand cards really start to drop? Is that maybe late next year or more 2028? And thanks for taking the questions. Andrew R. Harrison: I think if you are referring Duane, to the, Summit card, which we dropped a year ago, And as I shared in my prepared remarks, it is grown remarkably well. Those economics are already coming through. We shared, like, 40% of members are outside of our core. And with all this new growth that we are doing as well as Starlink and the new member sign ups, the whole machine around loyalty members and growth and maturity into cardholders is really working really well. And, again, with our, longer term double digit increases in bank cash through the decade, we are. that is still, where we are headed, and it still looks, very solid. Benito Minicucci: Yeah. And, Duane, just to add on that, remember, this is an entire ecosystem. We said that we wanna diversified revenues up to 60%, at Alaska. We have got a 1-point improvement quarter to quarter. We had 54%. So you will start seeing this wheel of inertia starting to gaining momentum quarter over quarter, and we will let you know where we are on that. But I. We are we are very optimistic. These things work all together jointly as a system. Duane Pfennigwerth: Thank you. Ryan John: Thanks, Duane. Operator: And our next question will come from Connor Cunningham with Melius Research. Conor Cunningham: Hi, everyone. Thank you. In the quarter, I think you had a 2-point decline in load factor and you are obviously pushing yields. But I am just trying to understand willingness to give up load factor in 2027 for higher yields Like, assume some of the third quarter stuff was, like, related to Hawaii cancellations and whatnot. But just again, trying to understand volumes versus yields and how you wanna manage that going into next year. Thanks. Andrew R. Harrison: Yeah. Thanks, Conor. that is you know, that is the question. And, you know, our teams understand clearly the goal is to maximize unit revenues. And, of course, you have got the yield and the loads there. We are watching the loads right now from where we sit the load trade off from the increasing yields, we feel really good about. And, again, as we get into next year, that is something that we are continuing to monitor, by region. Right now, given what I see, there will be continued load pressure from about sort of where we sit. But, again, you know, we will make the right adjustments along the way if we believe that it is more revenue accretive to take a little bit more load and a little bit less yield, but that is the fine balance that the team's working. Conor Cunningham: Okay. And then maybe stick with you, Andrew. Just. I have been thinking about the potential of the international JVs and really how that changes your profitability of your international franchise. So I mean, I mean, 1, can you provide some timeline on how you think that will all play out? And just really how you think that will change the structure of that business going forward. And if you wanted to give any color around I mean, I know you have talked about the drag from, I mean, unit revenue. But on profitability overall, I think that could be helpful in the construct as we start to think of the benefits going forward. Thank you. Andrew R. Harrison: Yes. We expect to file sort of in this fourth quarter. I think, you know, how these joint businesses work, but I think, you know, especially you know, we are prepared and ready to, you know, continue to grow for the foreseeable future. Obviously, the you know, international franchise under our own steam. But, you know, once we, get into joint businesses and especially, leveraging the distribution strength of our global partners, and the ability to look at capacity and pricing there is just a lot of strength in our economics, and although I am not gonna share the numbers with you is upside to today. So, again, like, 85% of all transatlantic traffic today is in a joint business. We just see this as nothing but a strengthening and upside in our ability to continue to fuel our growth. Benito Minicucci: Andrew, I might just add, Conor. What we are really doing here is adding a lot of competitive capacity out of Seattle. And the more successful that is, the more we can build domestic competitive capacity. So this is a really good thing for the West Coast and for our core customer base, and we are excited to go forward and hopefully partner more deeply with our OneWorld partners. Conor Cunningham: Appreciate it. Thank you. Ryan John: Thanks, Conor. Operator: And our next question comes from Catherine O'Brien with Goldman Sachs. Catherine O'Brien: Hey, good morning, everyone. Thanks for the time. I just wanted to come back to some of the network investments that you are making and how you expect to see growth in places like San Diego and Portland you know, going forward, you know, where at Investor Day, you flagged you are looking to gain share between now and 2030. I guess just trying to think philosophically how you are weighing the longer term strategic value of that growth. Versus some of the shorter term pressure it is putting on results as you make those investments? Andrew R. Harrison: Thanks, Catherine. I think just for clarity, the growth is already in there. that is been put in. You are seeing it. that is what I. My shared remarks, and, you are gonna see that abate next year. And without going into any other detailed perspectives on where our growth is, but we have got San Diego and especially Portland and some of the moving around in Hawaii to a place where we feel really good as we shared about having the relevant scale and loyalty and being able to capture the local market share, in the areas that we operate in. So, again, our growth next year will primarily be focused on gauge with these dash tens coming in, and some of the restructuring of our hubs. But, again, most of the growth that we have been talking about has already been put into the system. Catherine O'Brien: Maybe just the quick follow-up on that, and then 1 more on next year's capacity. I guess, Andrew, are you saying that you feel you have the right the network is at the size to capture that, you know, 8 points higher share in Portland by 2030, the 5 points higher share in San Diego. And so that is a follow-up. And then quickly, you just you know, you have spoken about getting to 4% growth. Is that meant to be a 27 comment, or that is just a medium-term comment? Just where capacity is better matched with inflation. Thanks. Andrew R. Harrison: I will let Shane comment on the capacity for next year, but this is all about phased and phasing. And, really, the near term and sort of phase 1 as we get done this year and just roll over into 27 has been to stand up the Portland and San Diego growth. We have got some California Francisco, Los Angeles growth in Hawaii, and, of course, structuring the hub in Seattle and Portland to work better together That work is mostly, being put into place, and we expect to harvest, results from that next year. Shane R. Tackett: Yeah. And, Jamie, we are not giving a guide for 2027, but such as it is, I think we have talked openly about sort of focusing on getting to our long term target somewhere around 4% over the next several years. That was consistent with what we laid out in 24's investor day, and I think we reiterated a few weeks ago. So that. that is kind of our high level thinking, and we will refine, you know, specific numbers over the next couple months. Catherine O'Brien: Okay. Thanks, guys. Ryan John: Thanks, Catherine. Operator: And we will move next to Tom Fitzgerald with TD Cowen. Thomas Fitzgerald: Hey, everyone. Thanks so much for the time. I wanted to ask about cargo. And I guess, part A, at Investor Day, talked about tripling revenues by the end of the decade in that segment. Is that linear or lumpy? Or are there any kind of contractual or things that could affect the timing of that? And then maybe as part of that, just where things stand with the Amazon contract and improving the economics of that it is hockey stick, Tom. Shane R. Tackett: No. it is not. it is, Jason can, talk you through it. Jason Matthew Berry: Thanks, Tom. You we did say we are gonna triple cargo, and it is not is definitely not a hockey stick. It is linear, but we have a few milestones that we expect to get 4 new freighters next year on the narrow body side. that is gonna double our capacity on the narrow body freighter fleet, which we are excited to do in Hawaii and Alaska. Also have the delivery of these wide body aircraft, the 87 sevens in particular. And as those come on, we are seeing direct benefit to the entire network as we build those out. So it is. We are building out our base and continuing to grow. it is it is it is very linear and steady, and we are confident in the course we are headed. Yeah. And on Amazon, we have been really enjoying getting, closer in partnership with them. We are optimistic about our ability to partner more deeply. We do not have anything to share today, but, hopefully, of course, in the next few months, we will have more clarity on what that looks like going forward. But really excited about the future of the cargo business, for all the reasons Jason laid out and what Ian shared at Investor Day. Thomas Fitzgerald: Okay. That. that is really helpful. And then just a quick follow-up on the technology side. You know, you made a new hire there this week. I think it was at Jamie's conference last December, you were talking about I think it was, like, hygiene areas to improve, like, more resilience and redundancy. Can you speak to where things stand on that front? And what some of the focus areas on the technology side? Are for the team in 2027. Thanks again for the time. Shane R. Tackett: Thanks, Tom. Thanks for listening in on Jamie's, conference. Last year. Yeah. We had, a lot of focus and investment in the infrastructure stability side of the business. We have been executing that plan for more than the 12 months at this point. it is going really well. I think we have seen much more sort of, like, reliable stability in the system, and our sort of tier 1 operational, critical systems. And we are gonna continue to invest in that side. Obviously, lots going on in the outside world around technology and AI, and it is definitely a place that we want to continue to focus invest in, build up our capability and talent in, which is 1 of the 1 of the reasons amongst many that we created the CITO position, and Benito can speak more to that briefly here. Benito Minicucci: Yeah. Yeah, Tom. Technology is moving more from a support function to being really a competitive advantage on how you opt operate and how you grow. So, look. We are a big company now. We are excess of $15 billion, and so we are excited to bring Amaresh who comes with a phenomenal background, of technology and innovation like Shane said, with AI and cyber being such a big part of how companies like ours with technology-dependent, operates. So we are excited to welcome him on board and I think you will see a lot of great things on the technology front from Alaska in the next few years. Operator: Alright. I think we have time for about 1 more question. And that question will come from Brandon Oglenski with Barclays Capital. Brandon Oglenski: Hey, good morning, everyone. And Shane, I guess I will give you maybe a more critical 1. Ryan, you did not want to take this last 1 from me, but I think you said like, core nonfuel earnings improvement of, like, $3 to $4, and that I am just trying to square that with, you know, closer to a $5 loss this year. And especially if we just take, you know, snapshot of energy futures right now, fuel prices could actually be higher in 2027 than they are averaging for you in 2026. So I do not know. I mean, is this just a case where if fuel is gonna be as energy future suggests today, you know, just another loss making year because you are making these structural changes in your network that are just hard to reverse at this point? Or there incremental things you can do looking into next year? Shane R. Tackett: Thanks, Brandon. No. I am I am happy to take this. I think and we. Obviously, this is another thematic thing from Investor Day, what we were trying to be clear on is the underlying improvement in the business which is really about all of the investments that we are making that Andrew spoke to, and I spoke to and Benito spoken to both network wise in places like Portland and Hawaii and San Diego, certainly international out of Seattle and premium. Those are where, the real revenue growth is going to come from those investments. So you have to make those. You cannot--you cannot sort of blink in the face of a really difficult backdrop because as you know, we make 20, 30 year decisions with these things, and we are very committed to it. We have the financial wherewithal to withstand the current backdrop and the balance sheet. I think if, you know, if fuel is structurally higher at anything close to what we see today, I would anticipate much like the industry has always done, it will have to react to that. And at some point, we will have to fully recover, all of the fuel price And I do not have any reason to believe that will not happen. We can all sort of make gloomy predictions about the macro economy and the back of demand. But I think the things that we are focused on are what we are seeing in demand today, which is really strong. People are still wanting to travel. They are still they are still allocating dollars to, you know, and going and seeing friends and family. We see really strong business travel. And I guess I would just end with saying we are hopeful that the forward fuel curves and futures are wrong. Like I think for the broader economy and for the country, we want to see lower energy prices, of course. But if they are elevated, the industry will structurally have to respond to that and we are well-positioned to participate in whatever environment we face next year. I will leave it at that. Brandon Oglenski: Thanks, Shane. Ryan John: Thanks, Brandon. Thanks, Brandon. And thank you for joining us everyone, and we will talk to you next quarter. Operator: This concludes today's conference call. You for attending. The host has ended this call. Goodbye. Before you buy stock in Alaska Air Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Alaska Air Group wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Alaska Air (ALK) Q3 2026 Earnings Call Transcript was originally published by The Motley Fool

United Airlines Holdings, Inc. UAL reported third-quarter 2026 adjusted earnings of $2.54 per share, down 8.6% year over year and below the Zacks Consensus Estimate of $2.60 by 2.3%. Higher fuel expenses weighed on profitability despite strong revenue growth. Operating revenues rose 17.4% year over year to $17.88 billion but missed the consensus mark of $17.91 billion by 0.2%. A 15.9% increase in total revenue per available seat mile or TRASM, supported the top line, driven by strength across premium, loyalty and contracted business revenues. United Airlines Holdings Inc price-consensus-eps-surprise-chart | United Airlines Holdings Inc Quote Passenger revenues increased 17.6% year over year to $16.24 billion. Domestic passenger revenues advanced 19.9% year over year, while international passenger revenues rose 14.3%. Latin America revenues rose 24.2% year over year, Pacific revenues climbed 16.5% and Atlantic revenues improved 10.1% year over year. Within the Atlantic region, Europe revenues increased 13.3% year over year, partly offset by a 17.3% decline in the Middle East, India and Africa region. Cargo revenues jumped 22.9% year over year to $529 million, while other operating revenues grew 12.9% to $1.11 billion. Premium revenues rose 17% year over year, while Basic Economy and loyalty revenues increased 16% and 17%, respectively. Contracted business revenues advanced 26% year over year, reflecting resilient close-in demand. Economy cabin unit revenues improved 17% year over year. Consolidated passenger revenue per available seat mile increased 16.1% year over year, while passenger yield climbed 16.8%. Domestic PRASM advanced 14.5% year over year, while international PRASM grew 17.4%, reflecting strong revenue performance across the network. Traffic, measured in revenue passenger miles, increased 0.7% year over year, while capacity expanded 1.3%. As capacity growth outpaced traffic, the consolidated load factor declined 0.5 percentage points to 83.9%. United Airlines transported a record 49.5 million passengers, up 2.4% year over year from the prior-year period. Domestic load factor declined 0.9 points to 84.4%, while international load factor remained nearly unchanged at 83.2%. Operating expenses increased 18.8% year over year to $16.43 billion, outpacing revenue growth. Aircraft fuel expenses surged 61.6% year over year to $4.84 billion as the average fuel price increased 60.3% to $3.90 per gallon. Fuel consumption rose 0.8% year over year. Cost per available seat mile increased 17.3% year over year to 18.56 cents. CASM-ex, which excludes fuel, profit sharing, special items and third-party business expenses, rose 7.8% year over year to 13.09 cents. Salaries and related costs increased 8.9% year over year to $4.96 billion. Distribution expenses climbed 13.9% year over year, while landing fees and other rent rose 4.4%. Aircraft maintenance expenses increased 3.5% year over year. Adjusted operating income declined 6.9% year over year to $1.23 billion, while the adjusted operating margin contracted 1.8 percentage points to 6.9%. Adjusted pre-tax income fell 8.7% to $1.11 billion, with the adjusted pre-tax margin narrowing to 6.2% from 8%. Adjusted net income decreased 8.4% year over year to $833 million. On a reported basis, net income increased 8.5% year over year to $1.03 billion, while earnings rose to $3.14 per share from $2.90. The difference between reported and adjusted results reflected special credits, primarily associated with gains from aircraft sale-leaseback transactions. Operating cash flow totaled $465 million during the third quarter compared with $1.22 billion a year ago. Free cash flow was negative $1.84 billion compared with negative $153 million in the prior-year period. Adjusted capital expenditures totaled $2.19 billion, reflecting continued fleet and infrastructure investments. Available liquidity ended the quarter at $17.7 billion. Cash and cash equivalents totaled $6.65 billion, while short-term investments were $8.01 billion. Debt, finance lease obligations and other financial liabilities were $26.40 billion. Trailing-12-month net leverage stood at 2.4 times. United Airlines expects fourth-quarter 2026 adjusted earnings between 50 cents and $1.50 per share (Zacks Consensus Estimate of $1.75 lies above the guided range), assuming an all-in average fuel price of approximately $4.80 per gallon. Management expects fourth-quarter revenue growth to accelerate from the third quarter, exceeding 20% year over year. Unit revenue growth is also expected to accelerate, while unit cost growth excluding fuel is projected to moderate. Adjusted capital expenditures are forecast at approximately $7.5 billion for 2026. United Airlines' fleet plan calls for 1,166 mainline aircraft and 441 regional aircraft by year-end. The airline has installed Starlink on more than 640 aircraft and expects fleet-wide availability by the end of 2027. Currently, UAL has a Zacks Rank #5 (Strong Sell). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Delta Air Lines DAL reported third-quarter 2026 earnings (excluding 57 cents from non-recurring items) of $1.72 per share, missing the Zacks Consensus Estimate of $1.80 by 4.44%. Earnings increased year over year despite sharply higher fuel costs and rising non-fuel expenses. Adjusted revenues climbed 16% year over year to $17.59 billion but missed the consensus estimate of $17.74 billion by 0.9%. Broad demand strength and healthy yields lifted adjusted total revenue per available seat mile, or TRASM, 15%, while premium and diversified revenue streams continued to expand. J.B. Hunt Transport Services, Inc. JBHT reported third-quarter 2026 earnings of $1.82 per share, up 3.4% from $1.76 a year ago. The figure beat the Zacks Consensus Estimate of $1.81 by 0.6%. Operating revenues climbed 20.4% year over year to $3.68 billion and surpassed the consensus mark of $3.56 billion by 3.2%. Stronger pricing, an 8% increase in Intermodal loads and higher brokerage volumes supported growth. However, elevated driver-related expenses, fuel costs and insurance claims pressured profitability. Alaska Air Group, Inc. ALK reported third-quarter 2026 adjusted earnings of 36 cents per share, excluding certain tax impacts, beating the Zacks Consensus Estimate of 35 cents by 2.9%. The company had reported adjusted earnings of $1.05 per share a year earlier. Higher fuel expenses weighed on profitability despite strong revenue momentum. Operating revenues increased 14.4% year over year to $4.30 billion but missed the consensus mark of $4.31 billion by 0.1%. Revenue per available seat mile, or RASM, rose 11.7%, supported by strong yields, premium demand and loyalty revenues. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report United Airlines Holdings Inc (UAL) : Free Stock Analysis Report Delta Air Lines, Inc. (DAL) : Free Stock Analysis Report J.B. Hunt Transport Services, Inc. (JBHT) : Free Stock Analysis Report Alaska Air Group, Inc. (ALK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Alaska Air Group, Inc. ALK reported third-quarter 2026 adjusted earnings of 36 cents per share, excluding certain tax impacts, beating the Zacks Consensus Estimate of 35 cents by 2.9%. The company had reported adjusted earnings of $1.05 per share a year earlier. Higher fuel expenses weighed on profitability despite strong revenue momentum. Operating revenues increased 14.4% year over year to $4.30 billion but missed the consensus mark of $4.31 billion marginally by 0.1%. Revenue per available seat mile or RASM, rose 11.7%, supported by strong yields, premium demand and loyalty revenues. Alaska Air Group, Inc. price-consensus-eps-surprise-chart | Alaska Air Group, Inc. Quote Passenger revenues increased 13.5% year over year to $3.89 billion. Loyalty program other revenues rose 31.5% year over year to $263 million, while cargo and other revenues advanced 12.7% to $160 million. Premium revenues grew approximately 25% year over year, representing more than 36% of total revenues. Loyalty program cash remuneration increased 21% to $721 million, while managed corporate revenues jumped 30% year over year. Diversified revenues, representing revenues outside the main cabin, accounted for 54% of the company's total revenues. Consolidated traffic, measured in revenue passenger miles, remained essentially flat year over year, while capacity increased 2.4%. With capacity growth outpacing traffic, the consolidated load factor declined 2 percentage points to 82.8%. Passenger volumes decreased 1.1% year over year to 15.7 million. However, yield increased 13.4% to 18.73 cents, while passenger revenue per available seat mile rose 10.9% year over year to 15.52 cents. Revenue performance reflected improving pricing trends, with September yield increasing approximately 17% year over year. The gains came despite headwinds in Hawaii, investments in strategic growth markets and rapid international expansion. Total operating expenses increased 16.8% year over year to $4.23 billion, outpacing revenue growth. Aircraft fuel expenses rose 59.5% year over year to $1.21 billion as economic fuel cost climbed 57% to $3.94 per gallon from $2.51. Fuel consumption increased 1.7%. Wages and benefits rose 5% year over year to $1.29 billion, while landing fees and other rentals increased 9%. Aircraft maintenance expenses climbed 8% year over year, while selling expenses and food and beverage service costs each advanced 10%. Other operating expenses increased 16% year over year, further pressuring profitability. These increases more than offset a decline in special-item costs. Cost per available seat mile excluding fuel, freighter costs, performance-based pay and special items increased 4.4% to 11.46 cents from 10.98 cents a year ago. The increase was within management's prior expectation for low-to-mid-single-digit growth. Adjusted operating expenses, excluding these items, rose to $2.87 billion from $2.68 billion. Adjusted pretax income declined to $49 million from $173 million a year earlier. Adjusted pretax margin contracted to 1.1% from 4.6%. Adjusted net loss totaled $35 million compared to adjusted net income of $123 million in the prior-year quarter. On a reported basis, operating income declined 44.6% year over year to $82 million. GAAP net loss totaled $147 million or $1.32 per share compared to net income of $73 million or 62 cents per share, a year ago. A cumulative tax adjustment related to previously recognized first-half losses reduced third-quarter adjusted earnings by 67 cents per share. Operating cash flow totaled $149 million during the third quarter and $755 million for the first nine months of 2026. The company ended September with $3.3 billion in available liquidity. Cash and cash equivalents were $835 million, while marketable securities totaled $1.40 billion. Long-term debt and finance leases, including current maturities, reached $6.16 billion. Adjusted net debt to EBITDAR increased to 5.5 times from 2.9 times at year-end 2025, while debt to capitalization rose to 66% from 59%. For the fourth quarter of 2026, Alaska Air expects an adjusted loss of $2-$2.50 per share. Capacity is projected to increase 1-1.5%, with growth concentrated in international operations. Unit revenues are expected to rise in the low double digits, while non-fuel unit costs are projected to increase in the mid-single digits. The outlook assumes an economic fuel cost of $4.65-$4.85 per gallon. For full-year 2026, management anticipates an adjusted loss of $5-$5.50 per share, reflecting $1.8 billion in fuel expenses above its initial plan. Currently, ALK has a Zacks Rank #4 (Sell). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Delta Air Lines DAL reported third-quarter 2026 earnings (excluding 57 cents from non-recurring items) of $1.72 per share, missing the Zacks Consensus Estimate of $1.80 by 4.44%. Earnings increased year over year despite sharply higher fuel costs and rising non-fuel expenses. Adjusted revenues climbed 16% year over year to $17.59 billion but missed the consensus estimate of $17.74 billion by 0.9%. Broad demand strength and healthy yields lifted adjusted total revenue per available seat mile or TRASM, 15%, while premium and diversified revenue streams continued to expand. J.B. Hunt Transport Services, Inc. JBHT reported third-quarter 2026 earnings of $1.82 per share, up 3.4% from $1.76 a year ago. The figure beat the Zacks Consensus Estimate of $1.81 by 0.6%. Operating revenues climbed 20.4% year over year to $3.68 billion and surpassed the consensus mark of $3.56 billion by 3.2%. Stronger pricing, an 8% increase in Intermodal loads and higher brokerage volumes supported growth. However, elevated driver-related expenses, fuel costs and insurance claims pressured profitability. United Airlines Holdings, Inc. UAL reported third-quarter 2026 adjusted earnings of $2.54 per share, down 8.6% year over year and below the Zacks Consensus Estimate of $2.60 by 2.3%. Higher fuel expenses weighed on profitability despite strong revenue growth. Operating revenues rose 17.4% to $17.88 billion but missed the consensus mark of $17.91 billion by 0.2%. A 15.9% increase in total revenue per available seat mile or TRASM, supported the top line, driven by strength across premium, loyalty and contracted business revenues. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Alaska Air Group, Inc. (ALK) : Free Stock Analysis Report Delta Air Lines, Inc. (DAL) : Free Stock Analysis Report United Airlines Holdings Inc (UAL) : Free Stock Analysis Report J.B. Hunt Transport Services, Inc. (JBHT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. - Total Revenue: $4.3 billion, up 14% year-over-year. - Capacity Growth: Up 2.4% year-over-year in Q3. - Unit Revenue (RASM): Increased nearly 12% year-over-year, in line with low double-digit expectations. - Yield: Grew 13.4% year-over-year, with monthly improvement from 11% in July to ~17% in September. - GAAP Net Loss: $147 million, or $1.32 loss per share. - Adjusted Net Income: $40 million; adjusted EPS of $0.36 (excluding special items and revised tax rate impact). - Premium Revenue: Grew ~24.5% year-over-year, reaching more than 36% of total revenue mix (up 3 points YoY). - Diversified Revenue Mix: 54% of total mix, up 4 points from last year and 1 point from last quarter. - Managed Corporate Revenue: Increased 30% in Q3; future bookings ~30% above prior year levels. - Loyalty Program Cash: $721 million in remuneration, up 21% year-over-year. - Cargo Revenue: Grew 9% year-over-year. - Non-Fuel Unit Costs (CASMex): Increased 4.4% year-over-year, a sequential improvement from 6.5% in Q2. - Fuel Cost: Average price of $3.94 per gallon in Q3 (above original $3.75 guidance); Q4 expected at $4.65$4.85 per gallon. - Liquidity: ~$3.3 billion at quarter end. - Unencumbered Assets: $20 billion. - Debt to Capitalization: Stable at 66%. - Q4 Guidance: Adjusted loss per share of $2.50 to $2.00; capacity growth of ~1%1.5%; non-fuel unit costs up mid-single-digits; unit revenue up low double-digits. - Full-Year Guidance: Adjusted loss per share of $5.50 to $5.00. - Warning! GuruFocus has detected 5 Warning Signs with ALK. - Is ALK fairly valued? Test your thesis with our free DCF calculator. Release Date: October 21, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. - Diversified revenue mix reached 54%, up 4 points year over year, reducing dependence on fuel and increasing earnings resilience. - Premium revenue grew 24.5% year over year and now represents over 36% of total revenue, with a target of 40% by 2030. - Loyalty program cash remuneration increased 21% to $721 million, driven by strong card spend and premium card adoption. - Managed corporate revenues rose 30% with future bookings up 30%, indicating market share gains in business travel. - Unit revenue increased nearly 12% with yield up 13.4%, and a 7-point RASM to CASMex spread improved from 2 points in Q2. - Unprecedented fuel prices added $1.8 billion in costs this year, with Q4 fuel expected at $4.65-$4.85 per gallon versus initial plan of $2.50. - Q3 GAAP net loss of $147 million and adjusted net income of only $40 million, with Q4 adjusted loss per share guided at $2.00-$2.50. - Strategic growth markets (13% of capacity) created 3 points of unit revenue pressure, and international long-haul growth added another 1 point of drag. - Hawaii market faced 2 points of system RASM headwind due to excess industry capacity and weather disruptions. - Non-fuel unit costs increased 4.4% year over year, with core inflation of 4-5% expected to persist, pressuring unit costs. Q: Brandon Oglenski (Barclays) asked how to square the $3 to $4 of core non-fuel earnings improvement for 2027 with a roughly $5 loss this year, especially if fuel prices stay elevated or rise per futures curves. A: CFO Shane Tackett explained the improvement stems from investments in network (Portland, Hawaii, San Diego), international out of Seattle, and premium. He said the company has the financial wherewithal to withstand the current backdrop, and if fuel is structurally higher, the industry will have to react and fully recover the fuel price, as it always has. He noted demand today is really strong and the company is well positioned for whatever environment it faces next year. Q: Jamie Baker (JPMorgan) asked about the share repurchase program given elevated leverage, whether there are regrets, and what the lesson is for capital allocation. A: CEO Benito Minicucci said with a crystal ball on fuel prices, the company would have thought about the buyback differently, and it may conserve cash planned for buybacks next year. He noted that in a normal environment the buyback would have been very accretive given planned 2025 and 2026 earnings, and he doesn't expect the company to regret buying back roughly 20 million shares heading into 2027 and 2028. Q: Savanthi Syth (Raymond James) asked about the forward direction of the 3 points of pressure from strategic growth markets and when Hawaii pressure subsides or annualizes. A: CCO Andrew Harrison said the growth annualizes into next year, materially from Q2 onward, with core growth of a couple of points, all gauge (737-10s and international). On Hawaii, he expressed optimism for 2027 for three reasons: no expectation of multiple generational storms (January and February unit revenues are already double-digit), the single PSS transition in April and Hawaiian joining OneWorld removing friction, and constructive industry capacity (mainland-to-Hawaii capacity up 6% this past year but up only ~1.9% in Q1 and down over 4% in Q2 next year). Q: Mike Linenberg (Deutsche Bank) asked how long it takes the strategic growth markets and international routes to ramp to maturity and profitability, and whether the Heathrow outperformance is volume or revenue. A: CCO Andrew Harrison said of the 6 points of pressure, 3 points come from markets grown 20%-plus (Portland, San Diego, Los Angeles, some California-Hawaii), which are good growth with strong loyalty and corporate gains. International was about 1 point of drag, but international load factor rose 7.5 points and unit revenues were up 24%; near term it remains a drag. On London, the 3-point outperformance is fair share of front premium cabins, supporting the thesis that Seattle customers want to fly with Alaska. Q: Atul Maheshwari (UBS) asked about realistic CASMex growth for next year, core inflation expectations, and other non-fuel cost puts and takes. A: CFO Shane Tackett steered clear of formal guidance but said the company wants a growth rate in the 4% range over time, with core inflation between 4% and 5% (labor, airport investments, engine maintenance). He noted the company is getting further through integration milestones and can more aggressively optimize productivity and fleet utilization, while continuing to invest in premium, international, and loyalty. More specific guidance will come in January. Q: Atul Maheshwari (UBS) asked whether CapEx (~$1.9 billion planned for next year) can be pushed lower if fuel stays higher for longer, and how to balance near-term leverage versus long-term investment. A: CFO Shane Tackett said there is flexibility, citing a phenomenal partnership with Boeing, but the company intends to take all aircraft since the MAX 10 is much more fuel efficient and a better financial performer than the 737-700s it replaces, and the 787s are key to international. He noted debt to cap is 66%, a $0.75 fuel price move is worth roughly three to five turns of leverage, and the company has traditional debt, capital markets, and sale-leaseback options, with restoring balance sheet strength the top financial priority. Q: John Godyn (Citigroup) asked how the company would protect earnings and hit its Investor Day outlook if higher-for-longer fuel becomes the new normal. A: CEO Benito Minicucci said the Investor Day strategypremium, international, loyalty, and cargois designed to make the company more resilient to oil and other economic shocks and raise the earnings floor over the next two years. CFO Shane Tackett added that the company historically planned on $3 fuel while paying $2.50 for five or six years, and it is building a business responsive to whatever fuel environment emerges rather than predicting it. Q: Savanthi Syth (Raymond James) asked why the Q4 guide of low double-digit unit revenue implies similar RASM to Q3 despite slower capacity growthwhether it's a tougher comp or worsening trends. A: CCO Andrew Harrison said core coupon revenues (actual passenger fares) are accelerating into Q4, up nearly 3 points from Q3 to Q4. The apparent deceleration is masked by a comp issue: the Atmos launch last year, including the Summit and Ascent cards, creates a year-over-year headwind in Q4, but the core coupon business continues to accelerate. Q: Duane Pfennigwerth (Evercore ISI) asked how to size the total Hawaii headwind for this year in system RASM points or pre-tax dollars. A: CCO Andrew Harrison said at the highest level it would baseline at a couple of points on unit revenues for Hawaii, confirming it equates to about 2 points to system RASM. He added the team has sharpened its focus on the Hawaii franchise and feels ready for a constructive 2027 setup. Q: Conor Cunningham (Melius Research) asked about the potential international joint ventures, the timeline, and how JVs would change the profitability structure of the international franchise. A: CCO Andrew Harrison said the company expects to file in Q4 and is prepared to keep growing the international franchise under its own steam. Once in joint businesses, leveraging partners' distribution strength and the ability to coordinate capacity and pricing would be upside to today's economics, noting 85% of transatlantic traffic is For the complete transcript of the earnings call, please refer to the full earnings call transcript.

- Interested in Alaska Air Group, Inc.? Here are five stocks we like better. - Alaska Air Group reported a $147 million GAAP loss in Q3, although adjusted net income was $40 million. Revenue rose 14% to $4.3 billion, while unit revenue increased nearly 12% on stronger yields. - Higher fuel costs sharply reduced the outlook: Q4 fuel expense is expected to be about $650 million above the company's original assumptions, contributing to a projected adjusted loss of $2.50 to $2.00 per share and a full-year loss of $5.50 to $5.00 per share. - Management highlighted longer-term growth in premium travel, loyalty, cargo and international routes, including new Seattle service to Osaka and Tahiti. Diversified revenue reached 54% of the total, while Alaska ended the quarter with $3.3 billion in liquidity and plans to prioritize balance-sheet improvement. - 4 Buy-and-Hold-Forever Stocks Available at a Bargain Alaska Air Group (NYSE:ALK) reported a third-quarter GAAP net loss of $147 million, or $1.32 per share, as elevated fuel costs weighed on profitability despite higher revenue and improving unit-revenue trends. Excluding special items and the impact of a revised tax rate, the company reported adjusted net income of $40 million, or $0.36 per share. Total revenue rose 14% year over year to $4.3 billion, while capacity increased 2.4%. Unit revenue increased nearly 12%, supported by a 13.4% increase in yield. → The AI Sell-Off Continues—These 3 Stocks Keep Raising Guidance Anyway - Boeing Gets $50B in March Orders—Is BA Stock a Buy Now? President and CEO Ben Minicucci said the company's third-quarter performance supported its strategy to build a larger and more diversified business, even as fuel prices added substantial pressure. He said fuel costs are expected to add $1.8 billion in expense for the full year. "Demand remains healthy," Minicucci said, adding that revenue performed in line with company expectations. Alaska generated a seven-point spread between revenue per available seat mile, or RASM, and nonfuel unit costs during the quarter, up from two points in the second quarter. → Tesla's Roadster Reveal Hints at 2 Much Bigger Moves - Despite Bad Headlines, Boeing Still Wins Billion Dollar Contracts Management highlighted progress in its Premium, Loyalty, Cargo and International growth initiatives. Diversified revenues accounted for 54% of total revenue mix, up four percentage points from a year earlier and one point sequentially. Premium revenue rose about 24.5% year over year and represented more than 36% of total revenue, an increase of three percentage points from the prior year. Alaska said its completed narrowbody premium-cabin retrofits are expected to provide a full-year benefit in 2027, while further premium offerings are planned for its widebody fleet. → Luxury's Middle Market Is Cracking—These 3 Stocks Could Win Managed corporate revenue increased 30% in the third quarter, while future corporate bookings were also about 30% above year-earlier levels. In London Heathrow, the company said business-class cabin performance exceeded its fair market share by three points during the quarter. Loyalty program cash remuneration increased 21% to $721 million, driven by card spending and customer engagement. Andrew Harrison, executive vice president and chief commercial officer, said the company's Summit premium card has attracted a meaningful number of new customers, with roughly half of cardholders new to Alaska's portfolio and 40% coming from outside its core geographies. Alaska also announced plans to launch year-round Seattle service to Osaka, Japan, and Papeete, Tahiti, next spring. The additions will bring its Seattle international nonstop route total to nine as the company works toward a goal of 15 routes and becoming Seattle's leading long-haul international carrier by 2030. The company expects to file with the U.S. Department of Transportation in the fourth quarter to join Atlantic and Pacific joint international businesses. Harrison said joint businesses could strengthen Alaska's international economics through partner distribution, capacity coordination and pricing capabilities. Chief Financial Officer Shane Tackett said the company's average fuel price was $3.94 per gallon during the third quarter, above its July expectation of $3.75 per gallon. Fuel prices ranged from about $3.10 per gallon in early July to nearly $5 per gallon by the end of the quarter. For the fourth quarter, Alaska expects economic fuel costs of $4.65 to $4.85 per gallon, compared with its original 2026 planning assumption of $2.50 per gallon. Tackett said the additional fuel expense of more than $2 per gallon is expected to add $650 million in costs in the fourth quarter alone. The company forecast a fourth-quarter adjusted loss of between $2.50 and $2.00 per share and a full-year adjusted loss of between $5.50 and $5.00 per share. Tackett said the forecast includes a fuel headwind of more than $4 per share compared with the company's original assumption. Despite the near-term fuel pressure, management said it expects at least $3 to $4 of core earnings improvement next year, excluding the impact of fuel. Tackett said the company believes premium products, loyalty, cargo, international service and network investments will support stronger earnings over time. Alaska expects fourth-quarter capacity growth of approximately 1% to 1.5% year over year, with most of the increase coming from international flying. The company expects fourth-quarter unit revenue to rise by low double digits, broadly consistent with third-quarter performance. Nonfuel unit costs rose 4.4% in the third quarter, an improvement from a 6.5% increase in the second quarter. The company expects nonfuel unit costs to increase at a mid-single-digit rate in the fourth quarter, citing inflation, airport and real-estate costs, and engine maintenance expenses. Management said several network investments have temporarily pressured unit revenue, including rapid growth in strategic markets such as Portland, San Diego, Los Angeles and select California-Hawaii routes. Harrison said those markets represent about 13% of capacity and have been growing more than 20%, but the company expects improvement as the routes mature. Hawaii also remained a headwind, accounting for roughly two points of system unit-revenue pressure, according to Harrison. He said the outlook for 2027 is more constructive as industry capacity growth moderates, prior growth investments annualize and the company benefits from a single passenger service system and Hawaiian Airlines' oneworld membership. Alaska ended the quarter with approximately $3.3 billion in liquidity, $20 billion in unencumbered assets and a debt-to-capitalization ratio of 66%. Tackett said restoring balance-sheet strength will be the company's top financial priority as earnings and free cash flow improve. The company also plans to take delivery of 22 Boeing 737-10 aircraft beginning late in the first quarter of next year. Minicucci said the aircraft will initially enter service in Alaska's standard domestic configuration, while a later tranche planned for 2028 will feature the company's Aurora configuration with lie-flat seats. Alaska Air Group, Inc is an airline holding company headquartered in Seattle, Washington. Its principal subsidiaries include Alaska Airlines and Hawaiian Airlines, which operate under separate brands while serving passengers throughout North America, the Pacific and other international markets. Alaska Airlines provides scheduled passenger and air cargo services across the United States, Canada, Mexico, Costa Rica and the Bahamas, with a strong presence on the U.S. West Coast and in Alaska. 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 [email protected]. The article "Alaska Air Group Q3 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for October 2026.