Allegiant Travel Company used its third-quarter earnings call on November 4 to explain why a Boeing jet it ordered years ago is losing favor inside the airline. Executives said the plan to add premium cabins, including Allegiant Extra and a coming Allegiant First product, changes how the cost of each seat stacks up. The CFO indicated that on those terms the smaller 737 MAX 7 loses pace with the larger MAX 8.
The comments came alongside a rough set of numbers. Total operating revenue reached $961.6 million, up 71.1 percent from a year earlier, largely because the Sun Country acquisition closed on May 13. Even so, Allegiant posted a GAAP net loss of $15.2 million, or 56 cents a share, and an adjusted loss of 3 cents. Sun Country contributed $277.8 million in revenue but an $11.1 million pre-tax loss.
The fleet story has been drifting for a while. Allegiant announced a Boeing order in January 2022 that mixed 30 MAX 7 jets with 20 MAX 8-200s, and it began shifting toward the larger type in September 2023. The FAA approved the MAX 7 on August 3 after changes to anti-ice, flight-control software and cockpit alerts. In October the airline exercised six more MAX 8 options for 2028, lifting its firm order to 56 aircraft.
For travelers, the practical effect is slow and indirect: bigger planes with more premium rows could mean more upsell options on Allegiant routes in the next few years. Management still guided to adjusted full-year earnings above $6.00 a share and $1.00 to $1.50 for the fourth quarter. The airline ended the quarter with 192 aircraft, including 22 cargo freighters, and expects 193 by year-end.
Stay In The Loop
Get new Travel News stories in your inbox.
Leave a Reply