01:56 PM EST, 12/10/2024 (MT Newswires) -- Alaska Air Group ( ALK ) on Tuesday raised its fourth-quarter earnings guidance and outlined its long-term strategic plan, including delivering $1 billion in incremental profit.

The Alaska Airlines parent now expects fourth-quarter adjusted earnings between $0.40 and $0.50 a share, up from its prior range of $0.20 to $0.40. Analysts polled by FactSet are looking for $0.49. The company attributed the upgraded outlook mainly to "stronger revenue performance" and lower non-operating expense, according to a filing with the US Securities and Exchange Commission.

Alaska Air ( ALK ) forecasts revenue per available seat mile growth in the mid- to high-single-digit range, compared with a previous guidance of mid-single digits. Alaska Air ( ALK ) shares were up 13% in Tuesday afternoon trade and have gained 56% in value so far this year.

Capacity is slightly lower than the company's prior projections due to "challenging" weather conditions in the quarter, according to the filing. Alaska Air ( ALK ) now expects full-year adjusted EPS of $4.25 to $4.50, raising the lower end of its previous outlook range from $3.50. Wall Street is looking for $4.22.

The company's board on Monday approved an up to $1 billion share repurchase program, the filing showed.

Separately, Alaska Air ( ALK ), which recently completed the acquisition of Hawaiian Airlines parent Hawaiian Holdings, outlined a three-year plan to deliver $1 billion in incremental profit. The company's 2027 outlook includes EPS of at least $10 and pretax profit margins between 11% and 13%.

"The combination with Hawaiian gives us the scale to be stronger than either of us could have been on our own," Alaska Air ( ALK ) Chief Financial Officer Shane Tackett said. "It will drive substantial financial results that will continue to set us apart from our competitors."

For 2025, the company projects EPS of at least $5.75. Capacity is expected to rise 2% to 3%, while capital expenditures are pegged between $1.4 billion and $1.5 billion.

Alaska Air ( ALK ) said it will start offering nonstop flights from Seattle to Tokyo Narita in Japan and to Seoul Incheon in South Korea in 2025.

Separately, the International Air Transport Association said Tuesday that global airline industry revenue is expected to top $1 trillion for the first time next year, rising 4.4% annually to about $1.007 trillion. Passenger numbers are seen growing 6.7% to 5.2 billion in 2025, surpassing the 5 billion-mark for the first time. Net profit is expected to rise to $36.6 billion from an estimated $31.5 billion in 2024 despite cost and supply chain challenges.

"The buffer between profit and loss, even in the good year that we are expecting of 2025, is just $7 per passenger," IATA Director General Willie Walsh said in a statement. "With margins that thin, airlines must continue to watch every cost and insist on similar efficiency across the supply chain -- especially from our monopoly infrastructure suppliers who all too often let us down on performance and efficiency."

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