The Bull Case For Alaska Air Group (ALK) Could Change Following IT-Hit Q4 And Global Expansion Plans

• Alaska Air Group recently reaffirmed that the Alaska Airlines and Hawaiian Airlines brands will remain distinct while it expands its global footprint, including new long-haul routes from Seattle to London, Rome, Reykjavik, Tokyo and Seoul, with some services already operating and others scheduled to begin in 2026.
• At the same time, the company has warned that its upcoming fourth-quarter 2025 results, due January 22, were hurt by an IT outage, government shutdown-related revenue losses and higher fuel costs, pointing to pressure on profitability even as capacity and revenue edged higher.
• We’ll now look at how these IT-driven earnings headwinds affect Alaska Air Group’s longer-term investment narrative built around international expansion.

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Alaska Air Group Investment Narrative Recap

To own Alaska Air Group, you need to believe that its dual-brand model and Seattle-focused international build-out can offset rising costs and integration complexity. The latest warning on weaker fourth-quarter 2025 earnings, tied to an IT outage, fuel costs and government shutdown effects, highlights how operational and cost shocks remain the key near term risk, while investor attention stays on whether expanding long haul capacity can translate into healthier margins over time.

The recent announcement of new long haul routes from Seattle to London, Rome, Reykjavik, Tokyo and Seoul is central to this story, because it underpins the idea that an expanded international gateway can gradually reduce dependence on West Coast and Hawaii leisure traffic alone. For investors, the question is whether this wider network can ultimately support better unit economics without letting higher fuel, labor and technology spending eat up the benefits.

Yet even as Alaska Air leans into global growth, investors should be aware that sustained cost inflation and IT related disruptions could…

Read the full narrative on Alaska Air Group (it’s free!)

Alaska Air Group’s narrative projects $16.9 billion revenue and $1.2 billion earnings by 2028. This requires 7.8% yearly revenue growth and an earnings increase of about $0.9 billion from $313.0 million.

Uncover how Alaska Air Group’s forecasts yield a $65.47 fair value, a 31% upside to its current price.

Exploring Other Perspectives

Six fair value estimates from the Simply Wall St Community span roughly US$15 to US$67 per share, reflecting very different views on Alaska Air Group. You can weigh those opinions against the current focus on higher unit costs and IT related earnings pressure, and consider how such risks might shape the company’s performance over time.

Explore 6 other fair value estimates on Alaska Air Group – why the stock might be worth less than half the current price!

Build Your Own Alaska Air Group Narrative

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This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.

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