Spirit Airlines lowers second-quarter outlook on weak non-ticket revenue
6:38 pm Tuesday, July 16th, 2024
(Reuters) -Spirit Airlines on Tuesday cut its revenue outlook for the second quarter, citing lower-than-expected non-ticket revenue, sending its shares down more than 6% in extended trading.
The company now projects quarterly revenue to be $1.28 billion, compared with its earlier estimate of between $1.32 billion and $1.34 billion, the ultra low-cost carrier said in a regulatory filing.
Spirit said lower non-ticket revenue from ancillary services was a result of competitive pressures in the market.
The non-ticket revenue per passenger segment is estimated to be $64, “several dollars” below its initial expectations.
Additionally, Spirit estimates $37 million in AOG (aircraft on ground) credit from Pratt & Whitney. The airline gets a monthly credit as compensation for Spirit being unable to use aircraft with engine issues.
The carrier also estimates negative adjusted operating margin between 13.5% and 12.5% for the second quarter, adding that it would improve to negative 11.2% to 10.2% if all AOG credits are recognised.
Shares of Southwest Airlines and JetBlue were also trading down around 1% after hours.
(Reporting by Pratyush Thakur in Bengaluru; Editing by Maju Samuel)
