By Shivansh Tiwary
(Reuters) –Alaska Air Group forecast current-quarter profit above estimates on Thursday as soaring travel demand drove expectations of a strong summer season, sending its shares up 2.2% in premarket trading.
The airline, the operator of the Boeing (NYSE:BA) plane that suffered a mid-air cabin blowout in January, also reported a smaller loss in the first quarter, despite a $162 million impact from the more-than-two-week grounding of its 737 MAX 9 aircraft.
In an interview with Reuters on Thursday, CFO Shane Tackett said Alaska has deployed more of its inspectors at Boeing\’s factories since the January incident to ensure the jetmaker produces the highest quality aircraft that it can confidently fly safely.
Alaska Air (NYSE:ALK) reported an adjusted loss of 92 cents per share for the quarter ended March 31, compared with analysts\’ average estimates for a $1.05 loss, according to LSEG data.
\”Thanks to thoughtful capacity planning, network optimization, and diligent cost control, we are well-positioned to carry our strong performance into the second quarter and beyond,\” CEO Ben Minicucci said.
The Seattle, Washington-based airline would have reported an adjusted pre-tax profit of about $5 million for the quarter, absent the groundings of its MAX 9 jets.
To address the financial damages, Alaska Air received $162 million in initial cash compensation from Boeing, which has been excluded from its first-quarter results.
Many airline executives have highlighted robust travel demand across both domestic and international routes during the upcoming summer season.
Alaska Air forecast a second-quarter profit of $2.20 to $2.40 per share, compared with estimates of $2.12.
\”The carrier\’s unit revenue trends appear to be driving strength into the second quarter, and the full year itself,\” Citi analyst Stephen Trent said in a note.
Its operating revenue rose 1.6% to $2.23 billion, beating Street expectations of $2.19 billion.
