Sun Country profits despite industry challenges, slight dip in passengers

Sun Country Airlines flew more empty seats on its scheduled flights as domestic air travel demand dipped across the industry in February and March, with lower-than-expected bookings in the first quarter.

But even with a challenging environment for airlines, the Minneapolis-based leisure carrier is banking on continued profits in the coming months as its bookings show positive signs and the airline scales back some scheduled service to better align with the market.

And with its diversified business model, which relies on cargo and charter flights, the company expects to continue delivering profits as Sun Country transitions to summer service.

In a call with investors Friday, Sun Country reported $36.5 million in profit on $326.6 million in revenue. Revenue came in slightly under Wall Street’s $329.8 million consensus estimate, while earnings per share of 72 cents exceeded analysts’ 71 cent prediction.

The outcome at Sun Country follows some pressures aired by industry competitors, including Atlanta-based Delta Air Lines, the dominant carrier at Minneapolis-St. Paul International Airport. Last month Delta reported a bumpy first quarter and cut its revenue forecast for the year. American Airlines also slashed its guidance while United Airlines offered two separate outlooks, pointing to uncertainty over travel in 2025.

CEO Jude Bricker acknowledged during Friday’s investor call that Sun Country’s outlook is different compared with some of its peers in the budget class and major U.S. airlines.

“I think if you’re on the East Coast, moving people north, south or [transcontinental], it’s going to be a challenging summer. In the Midwest, where we serve, it looks really good,” Bricker said, pointing to continued strength in Sun Country’s leisure markets.

Weakness in traditional passenger service came as Sun Country increased its total number of departures 4.1% and carried 0.7% more customers compared with the same period in 2024. That led to a diminished efficiency metric in its passenger service.

Executives plan to shrink scheduled service in the summer by roughly 7% and predict a better efficiency rate. Meantime, Bricker said Friday that the booking trends for big city markets “looks really promising” as fares have accelerated over the past two weeks.

“We’re guiding conservatively, [but] I’m certainly seeing more positivity in bookings than what we’re baking into our forecast,” Bricker said.

Positive notes for Sun Country were on its cargo business — which company officials expect to ramp up in September — and chartered flights.

Sun Country’s cargo fleet spent a little less time in the air, yet delivered $28 million in revenue January through March, a 17.6% rise over last year.

The airline’s cargo business is tied to Amazon, which started paying higher rates in December and June under its contract with Sun Country. Airline executives attributed most of the increased cargo revenue to those higher rates.

Chartered flight earnings rose 15.6% compared with 2024. Interim Chief Financial Officer Bill Trousdale, who took over for longtime CFO Dave Davis last month, said the airline’s flights for NCAA during March Madness helped lift its profits. Sun Country’s on-demand charter flights grew 55% year-over-year, Trousdale said.

Sun Country also spent more to run its operations. Along with flying more overall by about 5.8%, Sun Country bumped its salaries 12.9% as pilot headcount and salaries increased; ground handling and landing fees went up and maintenance costs increased 12.2%.

Sun Country employs approximately 3,000 people, mostly based in Minnesota. The company recently inked new contracts with its flight attendants and dispatchers to include higher salaries.

Like its peers in the airline industry, Sun Country’s stock price has been pummeled over the past two months. On Friday, after the earnings call, the price was up about 7.7%.