Forget analysts' expectations. The best way to analyze how the 10 major airlines did is to look at operating figures, summarized in the handy-dandy chart below. Today we'll review the first six majors; Monday we'll cover the remaining four.

What do these numbers tell us? First, we see

Alaska Airlines

(ALK) - Get Report

posting some nice data. We weren't thrilled with the rise in operating expenses, which outpaced revenue growth. We'd attribute that partly to labor issues: Unhappy mechanics can slow down an airline and make life quite expensive to boot. And that's exactly what was going on at Alaska.

Alaska's operational stats were the best of the bunch, save the cost issue. As regular readers know, we think operational stats are the important ones. Loads were up, yield rose substantially (3.4%) and revenue per available seat mile, or RASM, hopped 3.9%. A very strong performance, considering the economic environment last quarter. But cost per available seat mile also added 5.4%, the biggest percentage gain of any major airline, and


too much.



, the parent of

American Airlines

, reported poor results, in our opinion. We'd say the highly touted "revenue premium" AMR used to command seems to have vanished of late. The airline's operating expenses jumped 7.2% against a scant 1.8% gain in revenue, which contributed to a 34% drop in net income. On the operational side, capacity growth outstripped revenue growth, and both yield and unit revenue dropped more than 4%. The only ray of light for American was that unit costs rose just fractionally.

America West


also saw cost growth outpace revenue growth. But the airline did manage to squeak out a 2% rise in net income. The biggest problems for America West are declining loads and flat RASM figures.

What's happening here? The airline has continued to become as lean as possible, while trying to increase yields. We think the chickens have come home to roost on this one. This is another reason we think CEO Bill Franke will try to make some type of deal by year-end. The airline is more or less stuck, with expenses increasing and revenue slipping behind.

Continental Airlines

(CAL) - Get Report

also saw expense gains outpace revenue expansion, resulting in a 16% drop in profits.

Biggest plus for Continental is that even though it grew at a furious rate, it still managed to increase load factor. But we can also see it needed fare reductions to do this: Both RASM and yield slipped. Cost per available seat mile, or CASM, also hopped.

Delta Air Lines

(DAL) - Get Report

reported good numbers, especially in comparison with its direct competitors, the


unit of


(UAL) - Get Report

, American and

US Airways



We liked the fact that operating revenue easily outpaced the growth in operating expenses, and the airline continued to outperform in terms of maintaining RASM and yield strength. Not much erosion here, as opposed to what we saw with the other big boys. And while Delta did drop back in terms of loads, the airline didn't suffer a substantial decline in yield or RASM. So the reduction is tolerable.

Southwest Airlines

(LUV) - Get Report

posted great numbers. Revenue growth outpaced the increase in operating expenses, and Southwest managed a nearly 3-point rise in load factor even though available seat miles increased by 10.5%. That's just outstanding. Southwest also saw RASM rise 2.4%. Yes, the airline did post a 2.2% decline in yield, but coupled with a 0.4% gain in CASM, we'd have to say these results are probably the best overall for the bunch.

Monday we'll take a look at TWA (TWA) , US Airways, Northwest (NWAC) and UAL.

Holly Hegeman, based in Dallas, pilots the Wing Tips column for At time of publication, Hegeman held no positions in any securities mentioned in this column, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. You can usually find Hegeman, publisher of PlaneBusiness Banter, buzzing around her airline industry Web site at While she cannot provide investment advice or recommendations, she welcomes your feedback at