Frontier Group Holdings (ULCC) fell short of revenue expectations in Q3 CY2025, with sales declining 5.2% year on year to $886 million. The non-GAAP loss of $0.34 per share was 7.7% above analysts’ consensus estimates. Despite this, Frontier’s EPS guidance for Q4 CY2025 is $0.12, above analyst estimates. The company’s operating margin was -8.7%, down from 2% in the same quarter last year. Frontier is recognized for its colorful animals on aircraft tails and operates as an ultra low-cost airline in the US and select international destinations. The company’s long-term sales growth rate over five years is 17.9%, but recent performance has shown a slowdown in demand. In Q3, Frontier missed Wall Street’s estimates with a 5.2% year-on-year revenue decline.

Frontier’s operating margin has been trending down and averaged negative 1.9% over the last two years. In Q3, the company reported a negative 8.7% operating margin, raising concerns about consistent lack of profits. Despite full-year earnings still being negative, Frontier has reduced its losses and improved its EPS by 8.7% annually over the last four years. Wall Street expects the company to improve its earnings losses in the next 12 months. The latest quarter showed a mixed performance for Frontier, with the stock remaining flat at $4.59 after reporting.

Frontier’s Q3 results highlighted an optimistic EPS guidance for the next quarter, surpassing analysts’ expectations. Adjusted operating income outperformed estimates, but EBITDA missed and revenue fell short. When considering an investment in Frontier, longer-term fundamentals and valuation should be weighed more heavily than just the latest quarter’s results.

Read more at StockStory: Frontier (NASDAQ:ULCC) Misses Q3 CY2025 Sales Expectations