Spirit Airlines Incorporated (NASDAQ:SAVE) shares are soaring Tuesday as the company updated its third-quarter guidance.
The company announced that for its latest quarter, its revenue per available seat mile (RASM) will fall by 6.5% year-over-year, which is narrower than the company’s previously projected guidance of a roughly 7% to 8.5% slide.
Spirit Airlines increased its guidance at the 8-K filing yesterday due to an improved “ticket and non-ticket yields and better-than-expected load factor.” Its RASM decline was previously higher over concerns that the hurricanes that ravaged several parts of the nation would have a negative effect on sales.
Hurricanes Harvey, Irma and Maria still had a great impact on Spirit as the storms prompted the company to cancel more than 1,650 flights, costing it nearly $40 million. In September, the company canceled about 1,400 flights.
Nevertheless, the company’s revenue passenger miles in September hiked 5.9% thanks to an 8.9% gain in overall capacity. Over the course of the period, the company raised its total available seat miles by 18%.
Spirit’s adjusted cost per available seat mile before accounting for the cost of fuel is slated to be flat or fall only marginally, compared to a previous outlook of up to a 3% decline.
SAVE stock surged 5.9% Tuesday. Shares were up as much as 8% earlier in the day before stabilizing and falling back down to about 6%.