Alaska Air Group Q3 Revenue Declines Year-Over-Year

TL;DR

Alaska Air Group Q3 revenue down to $2.6B from $2.8B last year, but YTD revenue up to $7.5B from $7.2B.

AI Summary

Alaska Air Group, Inc. filed its 10-Q for the period ending September 30, 2024. The company reported total operating revenue of $2.618 billion for the three months ended September 30, 2024, compared to $2.821 billion for the same period in 2023. For the nine months ended September 30, 2024, total operating revenue was $7.476 billion, up from $7.200 billion in the prior year.

Why It Matters

This filing provides insight into Alaska Air Group's financial performance, indicating a decrease in revenue for the third quarter of 2024 compared to the previous year, which could impact investor confidence and future stock performance.

Risk Assessment

Risk Level: medium — Revenue fluctuations and the competitive airline industry present ongoing risks to financial performance.

Key Numbers

• $2.618B — Q3 2024 Operating Revenue (Represents a decrease from the prior year's Q3.)
• $2.821B — Q3 2023 Operating Revenue (Benchmark for Q3 2024 revenue comparison.)
• $7.476B — Year-to-Date 2024 Operating Revenue (Shows an increase in revenue over the first nine months of 2024.)
• $7.200B — Year-to-Date 2023 Operating Revenue (Benchmark for year-to-date 2024 revenue comparison.)

Key Players & Entities

• Alaska Air Group, Inc. (company) — Filer of the 10-Q
• 20240930 (date) — End of reporting period
• $2.618 billion (dollar_amount) — Q3 2024 operating revenue
• $2.821 billion (dollar_amount) — Q3 2023 operating revenue
• $7.476 billion (dollar_amount) — Year-to-date 2024 operating revenue
• $7.200 billion (dollar_amount) — Year-to-date 2023 operating revenue

FAQ

Key Financial Figures

• $0.01 — ange on which registered Common stock, $0.01 par value ALK New York Stock Exchange
• $0 — as 126,944,559 common shares, par value $0.01, outstanding at October 31, 2024.

Filing Documents

• alk-20240930.htm (10-Q) — 2106KB
• ex1001alaskaairgroupguaran.htm (EX-10.1) — 49KB
• ex1002amendedandrestatedcr.htm (EX-10.2) — 1074KB
• alk10-q32024ex311.htm (EX-31.1) — 10KB
• alk10-q32024ex312.htm (EX-31.2) — 10KB
• alk10-q32024ex321.htm (EX-32.1) — 5KB
• alk10-q32024ex322.htm (EX-32.2) — 5KB
• 0000766421-24-000082.txt ( ) — 10420KB
• alk-20240930.xsd (EX-101.SCH) — 59KB
• alk-20240930_cal.xml (EX-101.CAL) — 93KB
• alk-20240930_def.xml (EX-101.DEF) — 374KB
• alk-20240930_lab.xml (EX-101.LAB) — 708KB
• alk-20240930_pre.xml (EX-101.PRE) — 526KB
• alk-20240930_htm.xml (XML) — 1348KB

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 28 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK 46 ITEM 4.

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES 47 PART II. OTHER INFORMATION 48 ITEM 1.

LEGAL PROCEEDINGS

LEGAL PROCEEDINGS 48 ITEM 1A.

RISK FACTORS

RISK FACTORS 48 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 58 ITEM 3. DEFAULTS UPON SENIOR SECURITIES 58 ITEM 4. MINE SAFETY DISCLOSURES 58 ITEM 5. OTHER INFORMATION 58 ITEM 6. EXHIBITS 59

SIGNATURES

SIGNATURES 60 As used in this Form 10-Q, the terms "Air Group," the "Company," "our," "we" and "us" refer to Alaska Air Group, Inc. and its subsidiaries, unless the context indicates otherwise. Alaska Airlines, Inc., Hawaiian Holdings, Inc., and Horizon Air Industries, Inc. are referred to as "Alaska", "Hawaiian", and "Horizon" and together as our "airlines." 2 CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Cautionary Note Regarding Forward-Looking Statements In addition to historical information, this Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those that predict or describe future events or trends and that do not relate solely to historical matters. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from historical experience or the Company's present expectations. You should not place undue reliance on our forward-looking statements because the matters they describe are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond our control. Our forward-looking statements are based on the information currently available to us and speak only as of the date on which this report was filed with the SEC. Other than as required by law, we expressly disclaim any obligation to issue any updates or revisions to our forward-looking statements, even if subsequent events cause our expectations to change regarding the matters discussed in those statements. For a discussion of risks and uncertainties that may cause our forward-looking statements to differ materially, see Item 1A. "Risk Factors" within this document and within the Company's Annual Report on Form 10-K for the year ended December 31, 2023. So

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ALASKA AIR GROUP, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (in millions) September 30, 2024 December 31, 2023 ASSETS Current Assets Cash and cash equivalents $ 1,015 $ 281 Restricted cash 27 — Marketable securities 1,490 1,510 Total cash, restricted cash, and marketable securities 2,532 1,791 Receivables - net 510 383 Inventories and supplies - net 202 116 Prepaid expenses 270 176 Other current assets 223 239 Total Current Assets 3,737 2,705 Property and Equipment Aircraft and other flight equipment 12,349 10,425 Other property and equipment 2,109 1,814 Deposits for future flight equipment 612 491 15,070 12,730 Less accumulated depreciation and amortization ( 4,548 ) ( 4,342 ) Total Property and Equipment - Net 10,522 8,388 Other Assets Operating lease assets 1,346 1,195 Goodwill 2,703 1,943 Intangible assets - net 888 90 Other noncurrent assets 363 292 Total Other Assets 5,300 3,520 Total Assets $ 19,559 $ 14,613 4 CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (in millions, except share amounts) September 30, 2024 December 31, 2023 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Accounts payable $ 242 $ 207 Accrued wages, vacation and payroll taxes 822 584 Air traffic liability 1,878 1,136 Other accrued liabilities 958 800 Deferred revenue 1,614 1,221 Current portion of operating lease liabilities 211 158 Current portion of long-term debt and finance leases 523 353 Total Current Liabilities 6,248 4,459 Noncurrent Liabilities Long-term debt and finance leases, net of current portion 4,159 2,182 Long-term operating lease liabilities, net of current portion 1,249 1,125 Deferred income taxes 889 695 Deferred revenue 1,578 1,382 Obligation for pension and post-retirement medical benefits 505 362 Other liabilities 452 295 Total Noncurrent Liabilities 8,832 3,859 Commitments and Contingencies (Note 7) Shareholders' Equity Preferre

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) NOTE 1. GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and basis of presentation The unaudited Condensed Consolidated Financial Statements include the accounts of Air Group, or the Company, and its primary subsidiaries, Alaska, Horizon, and Hawaiian Airlines (starting September 18, 2024). Purchase accounting impacts resulting from the Hawaiian Airlines acquisition are included as of September 18, 2024. Prior periods do not include Hawaiian results. The unaudited Condensed Consolidated Financial Statements also include McGee Air Services (McGee), a ground services subsidiary of Alaska, and other immaterial business units. All intercompany balances and transactions have been eliminated. These financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information. Consistent with these requirements, this Form 10-Q does not include all the information required by GAAP for complete financial statements. It should be read in conjunction with the consolidated financial statements and accompanying notes in the Form 10-K for the year ended December 31, 2023. In the opinion of management, all adjustments have been made that are necessary to fairly present the Company's financial position as of September 30, 2024 and the results of operations for the three and nine months ended September 30, 2024 and 2023. Such adjustments were of a normal recurring nature. Certain rows, columns, figures, or percentages may not recalculate due to rounding. In preparing these statements, the Company is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities, as well as the reported amounts of revenue and expenses, including impairment charges. Due to seasonal variations in the demand for air travel, the volatility of aircraft fuel

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