Alaska airlines reported a $166 million loss in the first quarter of 2025 due to economic challenges and policy changes. The SeaTac-based airline now merged with Hawaiian airlines earned $3.1 billion in revenue, up 42% from Q1 2024´s $2.23 billion.
Executives expected a loss this quarter but the $1.35 per share drop slightly exceeded internal forecasts driven partly by international. In April President Donald Trump imposed a 10% tariff on most imports including a 145% tax on Chinese goods.
China retaliated with its own 125% tariff on American imports creating uncertainty across markets including the travel industry. Although airlines don’t depend on imported goods, tariffs can reduce consumer spending and dampen travel demand indirectly.
Alaska Airline Q1 2025 earnings were also affected by travel advisories and changing immigration enforcement in multiple countries. St. John emphasized that while macroeconomics trends are uncertain Alaska´s internal operations and cost controls are performing strongly. He credited new initiatives such as a refreshed loyalty program and expanded credit card offers for driving customer retention and growth.
Alaska Airlines hasn’t seen a rise in direct costs from tariffs but noted lower-than-expected fares in some markets. Bookings on the upcoming Seattle-to-Tokyo nonstop route, launching May 12, are meeting projections despite market headwinds.
The airline plans to expand globally, leveraging its $1.9 billion merger with Hawaiian to serve at least 12 international routes. Alaska will soon begin flying long-haul widebody aircraft from Seattle, targeting a full global rollout by the year 2030.
Although tariffs could potentially affect Airbus imports, Alaska currently has no outstanding orders for European aircraft. Boeing remains on track to deliver seven 737s, one 787, and two Embraer jets to Alaska this quarter.
Alaska also incurred $40 million in merger-related costs and continued labor negotiations with Hawaiian’s workforce. While Delta and United revised their forecasts, Alaska Airlines Q1 2025 earnings suggest cautious optimism despite economic pressures.
