Why Alaska Air Stock Fell After Q3 2026: A Fourth-Quarter Loss Forecast Twice as Deep as Expected

Alaska Air Group forecast a fourth-quarter adjusted loss of $2.00 to $2.50 a share, at least twice the loss analysts expected, because jet fuel is set to cost $4.65 to $4.85 a gallon. The results came out after the close on Tuesday, October 20, 2026, and the first line of the release reached the MoveSurge news feed at 17:10:37 ET. In thin after-hours trading ALK rose 2.61% in the next minute, from $33.40 to $34.27. The stock traded higher on Wednesday morning, then slid from late morning and was at $33.56 at 16:12 ET, down 2.31% from Tuesday's close of about $34.35.

The third quarter itself was close to forecasts. Revenue rose 14% to $4.308 billion, in line with the $4.31 billion analysts expected. Adjusted earnings were $0.36 a share excluding certain tax effects, against a $0.28 consensus, according to Investing.com. A catch-up in the tax rate took $0.67 off adjusted EPS, which was a loss of $0.31 a share with that charge included. On a GAAP basis Alaska lost $147 million, or $1.32 a share, after earning $73 million a year earlier.

Fuel turned the forecast into a loss

Alaska paid $3.94 a gallon for fuel in the third quarter, above the $3.75 it assumed in July. Its fourth-quarter forecast of $4.65 to $4.85 is about $650 million above plan, and the company now puts the full-year fuel cost at $1.8 billion above plan. It expects an adjusted loss of $5.00 to $5.50 a share for 2026, against a consensus loss of $3.26, according to Zacks. Alaska had suspended its original 2026 profit forecast of $3.50 to $6.50 a share in April.

Revenue per seat held up. Revenue per available seat mile, the industry's measure of unit revenue, rose 11.7% while capacity grew 2.4%, and Alaska expects fourth-quarter unit revenue to rise by a low double-digit percentage. Chief executive Ben Minicucci said in the release: "While we're not satisfied with this quarter's result or the $1.8 billion fuel headwind this year, we are confident in our ability to execute on the things we can control." United Airlines, which also reported on October 20, cut its fourth-quarter outlook on $4.80 jet fuel.

How the stock traded on Wednesday

At 11:45:50 ET, during the earnings call, a headline quoting the chief financial officer on fuel costs reached the MoveSurge news feed: West Coast refining margins had been below Gulf Coast margins in September. ALK was at $35.005 just before it, about 1.9% above Tuesday's close, and it was down 1.33% ten minutes later. The candlestick chart below reads $35.00 after one minute, down 0.01%, and $34.65 after 12 minutes, down 1.00%. Other comments on the call may also have affected the price.

The American Airlines joint businesses

The release also repeated a plan Alaska first announced on September 29, 2026: joining American Airlines' Atlantic joint business, with British Airways, Iberia, Finnair and Aer Lingus, and its Pacific joint business with Japan Airlines. Partners in a joint business coordinate schedules and fares, which needs approval and antitrust immunity from the US Department of Transportation. "We expect to file… in this fourth quarter," chief commercial officer Andrew Harrison said on the call, adding that 85% of all transatlantic traffic already flies inside a joint business. He did not put a figure on the financial benefit.