Spirit Airlines Inc’s shares jumped as much as 27% in opening trade on Friday after the low-cost carrier primed investors for strong fourth-quarter results.
The gains followed a sharp decline in Spirit’s shares earlier this week after a federal judge moved to block its planned $3.8 billion acquisition by JetBlue.
In a regulatory filing, Spirit said revenue for the three months to December 31, 2023, is likely to be at the high end of its initial guidance as bookings for the peak holiday travel period were strong.
Additionally, it expects operating expenses to come in better than anticipated due to lower fuel costs driven by better-than-expected fuel efficiency and lower airport costs, among other factors.
It revised its adjusted operating margin guidance for the quarter by 450 basis points from negative 15-19% to negative 12-13%.
The airline has guided for year-over-year capacity growth of 1-2% for the first quarter of 2024.
Referring to the ruling against the JetBlue merger, Spirit said the airlines are reviewing the decision and evaluating their next steps.
“Spirit has stated that it disagrees with the US District Court’s ruling and continues to believe that a combination with JetBlue is the best opportunity to increase much-needed competition and choice by bringing low fares and great service,” Spirit commented.
The airline’s shares were up 25% at $7.12 by mid-morning in New York.