Alaska Air load factor falls below Q4 expectations, and is expected to fall further this month

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Alaska Air Group Inc. reported fourth-quarter load factor that was below expectations, and provided a downbeat outlook for January, as the air carrier saw revenue passengers decline during the quarter after reaching a pandemic peak in October. Load factor for the quarter was 45%, below the FactSet consensus of 50.5%, as load factor declined to 43% in December from 45% in November and 49% in October. For January, the company expects load factor to fall further to about 35% to 40%. Revenue passengers fell to 1,245 in December from 1,270 in November and 1,400 in October, and is expected to decline to 1,100 to 1,200 in January. Total revenue for the quarter was down 64% from a year ago, while the current FactSet revenue consensus of $831.4 million implies a 62.7% decline. Meanwhile, cash burn for the fourth quarter improved to about $350 million from $399 million in the third quarter, helped by increases in passengers carried and an improvement in demand for future travel, which hit post-COVID-19 highs in October. January cash burn is expected to be $125 million to $150 million. The stock, which is still inactive in premarket trading, has run up 34.5% over the past three months, while the U.S. Global Jets ETF has advanced 27.1% and the S&P 500 has gained 9.2%.
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