Alaska Air Group (ALK) Stock Plunges 14.89% in 9-Day Slide on Revised Earnings Outlook, IT Outage Fallout

Alaska Air Group’s stock (ALK) plunged to its lowest level since July 2025 on Tuesday, with an intraday drop of 2.64%, marking the ninth consecutive day of declines. The shares have fallen 14.89% over the past nine trading sessions, reflecting mounting investor concerns amid operational and earnings-related challenges.

The recent slump follows a downward revision to Alaska Air’s third-quarter 2025 earnings guidance, which now projects $1.00–$1.40 per share—well below the $1.88 consensus estimate. This adjustment was partly attributed to a significant IT outage in July 2025, which disrupted operations and reduced Q3 earnings by an estimated $0.10 per share. The incident highlighted vulnerabilities in the company’s infrastructure and led to customer dissatisfaction, compounding near-term risks.

Analyst sentiment remains mixed. UBS raised its price target for ALK to $56 from $49, signaling potential upside, while Seaport Res Ptn trimmed its Q3 2025 EPS estimate to $1.35 from $1.60, citing the IT-related impact. Despite these adjustments, the Zacks Rank system assigns ALK a neutral “Hold” rating, reflecting cautious optimism about the reinstatement of full-year profit forecasts and sustained travel demand. However, the company’s forward P/E ratio of 14.87 exceeds the industry average of 10.16, suggesting a valuation premium that may not align with its projected 30.39% year-over-year earnings decline for 2025.

Operational and macroeconomic headwinds further weigh on the stock. Rising interest rates have complicated refinancing of pandemic-era loans, increasing borrowing costs and limiting flexibility for IT upgrades or fleet investments. Meanwhile, the broader airline industry remains resilient, with Alaska Air’s performance lagging peers in terms of earnings growth. Investors are advised to monitor forthcoming operational updates and earnings reports to assess the effectiveness of management’s recovery strategies amid persistent uncertainties.