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Alaska closed its $1.9 billion. Acquisition of Hawaiian Airlines In September, less than a year after signing a deal that gives it access to the Pacific and wide-body aircraft. Boeing 787 Dreamliner and Airbus A330. The two brands are operating separately.
The airline will begin nonstop service between its home hub Seattle-Tacoma International Airport and Tokyo’s Narita International Airport in May on Airbus A330-200s in Hawaii, and between Seattle and Seoul, South Korea’s Incheon International Airport in October. Alaska said Tuesday. Tickets for the new flights to Tokyo go on sale on Tuesday, while fares for later routes go on sale in early 2025.
By 2030, Alaska plans to revamp the carrier, using widebody aircraft to at least a dozen international destinations from Seattle.
The carrier said Tuesday it authorized a $1 billion share buyback.
Alaska also forecasts pretax margins between 11% and 13% and earnings per share to top $10 in 2027. In October, the company forecast 2024 earnings of between $3.50 and $4.50 per share, including the Hawaii results. It raised its fourth-quarter earnings estimate to 40 cents to 50 cents per share, up from a previous outlook of 20 cents to 40 cents.
Alaska shares are up nearly 40% so far this year, outpacing the S&P 500’s 27% gain through Monday’s close. The airline’s shares rose nearly 16 percent in morning trade on Tuesday after it released its long-term plans, hitting a more than three-year high.
Alaska Air and S&P 500 Performance
The carrier is also launching a new “premium” credit card with its partner. Bank of AmericaThe latest co-brand deal is designed to capture revenue from customers even when they’re not flying.
Alaska is reviewing its premium seat offerings across the fleet. Chief Financial Officer Shane Tackett told CNBC that the airline is looking to upgrade options, particularly on Hawaiian’s Airbus A330s, with more customers paying for more space and comfort while traveling. Ready to do.
“When you look at the last two or three years, most of the revenue growth has been in those areas of demand and I think that’s probably going to continue,” Tackett said. “We have a really good baseman cabin product … but more people want the opportunity to go premium economy or first class and we need to meet that demand.”
Tackett said more seats than ever in first class and premium economy are being purchased by customers rather than being filled with free upgrades.
Rivals of Seattle Delta AirlinesSeattle, whose 24% domestic passenger market share is second only to Alaska’s 55%, also noted that A change in demand For its first class seats. However, Delta has a large share of international passengers from the airport.
Alaska said it plans to introduce a new lounge at San Diego International Airport. On Wednesday, Delta said it was opening its own. Delta One The lounge in Boston, the third after locations opened this year in New York and Los Angeles, is dedicated to customers traveling in its highest-class cabin.
Meanwhile, Tackett told CNBC that he expects more changes to Alaska deliveries from Boeing.
In January, a door plug blew off one of Alaska’s nearly new Boeing 737 Max 9s when it left the manufacturer’s factory without a key bolt. The near-disaster and accelerated quality testing have slowed Boeing production and deliveries to airline customers like Alaska. united And Southwest.
“I think they’re making progress. It’s not going to happen in a week. It’s going to take time,” Tackett said of Boeing, whose new CEO Kelly Ortberg The aircraft manufacturer is tasked with stabilizing the aircraft. “We’re in a position where we need to focus on helping them know that quality is the most important thing; that’s more important to us than rate.”
Boeing will release November airplane orders and deliveries at 11 a.m. Tuesday, a number expected to be hit by about one. A two-month mechanical strike Which stopped the production of most of the Boeing planes.
Boeing said Tuesday it has restarted production of the 737 at its Renton, Washington, facility and said production at its Everett, Washington, factory would begin in the next few days.