Alaska Airlines (ALK) lifted its projections for profits and revenue per available seat mile (RASM) for the current quarter, citing lower-than-expected fuel costs and benefits from the troubles of competitors during the July CrowdStrike (CRWD) outage that grounded thousands of flights.
The airline lifted its RASM projections for the third quarter to a roughly 2% bump, compared to flat to positive previously, while fuel cost per gallon is projected at a lower range of $2.60 to $2.70, down from $2.85 to $2.95 per gallon previously, a Thursday regulatory filing showed.
As a result of the higher revenue and lower fuel cost, Alaska Airlines lifted its earnings per share (EPS) projection to a range of $2.15 to $2.25, well above previous estimates of $1.40 to $1.60 and the $1.60 projected in analyst estimates compiled by Visible Alpha.
The company said it experienced "strong demand" for air travel through the summer, with its busiest schedule ever and a flight completion rate of 99.3% so far in the quarter.
"While capacity remains in line with prior expectations, revenue has performed better than anticipated driven by additional revenue in July related to CrowdStrike disruptions across the industry and stronger performance in August and September," the company said.
Some of Alaska's competitors, especially Delta Air Lines (DAL), struggled to resume normal operations following the disruptions, leaving room for other airlines like Alaska to gain some customers.
Alaska Air Group shares were 1.3% higher at $40.01 in intraday trading Thursday following the news and have climbed about 2.4% so far this year.
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