Frontier Airlines has revised its first quarter 2025 outlook due to weaker than expected demand, particularly in March. The airline now anticipates only a 5% increase in revenue, mirroring the growth in capacity, which is a reduction from earlier forecasts.
The demand downturn is attributed to fare discounting and widespread industry promotions, impacted further by the airline's close-in booking practices and decreased consumer confidence, as reported by The Conference Board Consumer Confidence Index. Additionally, Frontier has trimmed its scheduled capacity for the second quarter of 2025, particularly on off-peak days, in an effort to better align with demand and mitigate potential losses.
Despite these challenges, Frontier reported a net loss in Q1 2025 but remains optimistic for the rest of the fiscal year, expecting to exceed analyst estimates with an earnings per share of at least $1.00. The company saw record revenue of $1 billion in Q4 2024. Furthermore, Frontier is expanding its premium services, which have been positively received by customers, contributing to their revenue growth, according to Insider Monkey.
