Frontier Airlines forecasts a second-quarter loss as Trump tariffs hurt demand

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(Reuters) -Frontier Group, the parent of U.S. discount carrier Frontier Airlines, forecast an unexpected second-quarter loss on Thursday, even as it said demand for May and early summer travel has now stabilized.

Trump’s trade policy and sweeping tariffs have sparked a global trade war and raised the odds of the world spiraling into recession, making customers hesitant to spend on travel.

Frontier said it is now targeting a return to profitability in the second half of the year on the back of moderating industry-wide capacity, aggressive cost and capital expenditure management.

The economic downturn is creating headwinds for major U.S. airlines, which, just two months ago, were benefiting from strong travel demand and solid pricing across their networks.

Frontier forecast a second-quarter adjusted loss per share in the range of 23 cents to 37 cents, compared with analysts’ average expectations of a 15 cent profit, according to data compiled by LSEG.

It reported a wider-than-expected adjusted loss in the first quarter as its total revenue per passenger declined 6% from a year ago.

The company has reduced planned capacity for both the second quarter and the balance of 2025 to be down from a year ago, with adjustments focused on off-peak days of the week.

Frontier on Thursday said it will closely monitor the demand environment and make any further adjustments to capacity and related costs, as appropriate.

It refrained from providing a full-year financial forecast, citing the uncertainty in the demand outlook for the balance of the year.

It reported a first-quarter adjusted loss of 19 cents per share, compared with analysts’ expectations of 9 cents per share.

(Reporting by Shivansh Tiwary in Bengaluru; Editing by Alan Barona)