Alaska Airlines’ cargo unit 3Q earnings up despite market volatility

Seattle-based Alaska Airlines reported growth for its cargo unit during the third quarter of 2019, despite weakening global trade sentiment seen over the course of 2019. Alaska Airlines attributed the growth to new capacity available through the Virgin America fleet, as well as strong demand in its continental U.S. network.

Operating revenues for the carrier rose 8%, year-over-year, to nearly US$2.4 billion for the three-month period ending on Sept. 30. For the first three quarters of the year combined, Alaska saw a 6% increase y-o-y to almost $6.6 billion.

Operating revenue for the cargo and other (including some passenger side ancillary fees and lounges) unit increased 9% y-o-y to $60 million in the third quarter. The cargo unit alone grew 3% in the third quarter. For the first three quarters of 2019, the cargo and other unit saw a 15% y-o-y increase to $169 million.

Growth in the carrier’s cargo business benefited from the cargo capacity Alaska sold during the third quarter on the former Virgin America fleet.  Alaska Airlines also noted that volumes are up 33% y-o-y on its Airbus fleet operating in the continental U.S.

Returning to Alaska’s overall 3Q performance, net income for the third quarter of 2019 reached $322 million, a 48.4% increase compared to the same period the year prior. Net income for the first three quarters of 2019 totaled $588, up 42.0% compared to the first three quarters of 2018.