Reason for 8% drop in stock today I guess
Spirit Shares Plunge, Revenue From Fees Slows In Q3 - Investors.com
Spirit Airlines (SAVE) earnings took flight and topped estimates, but fee revenue from amenities didn't grow as fast as it did a year ago and shares plunged Wednesday.
The budget airline's third-quarter earnings more than doubled to 79 cents per share from 35 cents. Analysts polled by Thomson Reuters were expecting 74 cents per share.
Revenue jumped 33.4% to $456.6 million, topping estimates for $452.57 million. Passenger revenue revenue rose 38% to $279.5 million.
View Enlarged Image
Total revenue per available seat mile, an important metric in the airline industry, rose 8.9% to 12.55 cents as the load factor widened to 89.1%.
The average ticket revenue per passenger flight segment rose 15.3%, reversing a 12% decline a year ago. But the average non-ticket revenue per passenger flight segment rose 5.4% vs. a 11.5% gain in Q3 2012.
Spirit offers extremely low fares but then charges extra for everything from a carry-on bag to printing out a boarding pass at the airport.
The airline charges $25 for a carry-on bag when booking the flight, but the fee goes up to $50 when checking in at the airport. The first checked bag costs $20 and goes up to $45 at the airport.
Fees for what used to be free amenities have become a major source of revenue for airlines. In 2012, the 15 largest carriers collected $3.5 billion in baggage fees, a 3.8% increase from 2011.
Read More At Investor's Business Daily:
Spirit Shares Plunge, Revenue From Fees Slows In Q3 - Investors.com
Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook