Frontier Drops 2025 Forecast As Demand Wanes Amid Tariff Concerns, Retail’s Still Extremely Bullish

Frontier Airlines' parent, Frontier Group (ULCC), drew retail attention on Thursday after it withdrew its full-year forecast amid economic uncertainty.

The company said in a regulatory filing on Thursday that first-quarter revenue growth is expected to be lower than expected due to weakened demand in March, which resulted in fare discounting and promotions across the industry.

Frontier forecasted an adjusted loss of $0.20 to $0.24 per share for the first quarter. It had earlier projected a breakeven to $0.07 per share in profit for the first quarter and at least $1 in 2025 earnings.

Earlier this week, larger rival Delta Airlines also scrapped its full-year forecast amid tepid demand.

According to U.S. Transportation Security Administration data, annual growth in passenger traffic fell to 0.7% in March from 5% in January.

Analysts fear customers would cut down on air travel if recession fears persist due to a tariff-driven trade war.

The company expects revenue growth in the first quarter of about 5% on capacity growth of similar levels.

It also expects that capacity in the second quarter will be down by low single-digit percentage points compared to the prior year quarter.

Frontier is scheduled to report its first-quarter results on May 1.

Retail sentiment on Stocktwits remained in the ‘extremely bullish’ (76/100) territory, while retail chatter was ‘high.’

Frontier shares have fallen 50.7% year-to-date (YTD).

The S&P 500 Passenger Airlines sector has fallen 31.3% this year compared to the 10.2% decline in the broader S&P 500 index.

Also See: Fastenal Q1 Earnings Preview: Investors Seek Demand Trends Amid Recession Fears

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