Sun Country aims to take advantage of less airline competition at MSP

Sun Country Airlines executives say the Twin Cities budget carrier is positioned to benefit from less competition for commercial flights at Minneapolis-St. Paul International Airport, as well as more cargo shipments.

With a strong second-quarter profit in hand, CEO Jude Bricker told investors in a quarterly conference call Friday that many lower-cost airlines are not extending schedules past January. Spirit, Frontier, Allegiant and Southwest are maintaining or reducing their presence in the Twin Cities.

“We’re just seeing this become, very quickly, a two-airline market,” Bricker said, referring to Delta Air Lines as the other airline. “And I think both carriers are going to be really healthy in that environment.”

Minneapolis-based Sun Country reported $6.6 million net income on $264 million in second quarter revenue, beating Wall Street consensus estimates. Earnings arrived at 12 cents per share, a penny above expectations.

Despite the upbeat report, the airline’s stock price suffered Friday, closing down 11%. Stock prices for airlines, including Spirit, Frontier and Allegiant, also dropped amid a weak employment report and fresh tariff threats.

In Minnesota, Sun Country carries the second-most passengers after Delta, the Twin Cities’ dominant airline. MSP is home to Delta’s second-largest operations base after its headquarters in Atlanta.

This has been a bumpy year for airlines, including mainline carriers like Delta, which pulled and then restored its full year guidance for investors. Budget carriers have been seen as especially vulnerable to slowdowns in domestic U.S. air travel demand.

In January, Sun Country was focused on expansion of a strategic goal to invest more resources in its business of air cargo transport, which is driven through its partnership with Amazon. At the end of 2025, Sun Country will have a fleet with 45 passenger planes and 20 cargo-carrying aircraft.

Interim Chief Financial Officer Bill Trousdale said total second-quarter cargo revenue came in lower than expected because of delayed airplane delivery. But he said the company was able to make that up by pivoting pilots to chartered flights.

Executives touted the diverse business model in notching Sun Country’s second quarter profits.

And they forecast a strong third quarter through a continued emphasis on a business model that allows for flexibility in a potentially turbulent economic environment.

Revenue from scheduled passenger service was flat compared with the second quarter of 2024. Charter revenue rose 6.4%. Meantime, airfare increased 6.5%, offsetting a 1.3% dip in the number of paying passengers compared with empty seats. Cargo revenue increased 37% year over year.

Airline analyst Michael Linenberg of Deutsche Bank said other airlines have talked about consumers buying flights closer to takeoff, especially more price-sensitive flyers. Analysts also questioned Sun Country on what the airline is seeing on broader booking trends.

Bricker said perhaps the most significant trend for Sun Country is the lower passenger-to-open-seat ratio, though he said demand remains strong in the Northeast and Midwest. It has been weaker in warmer destinations like California and the Caribbean.

But even as some airlines express concerns about a bookings lag, Bricker said, Sun Country is “not really seeing a similar situation.”

He said the carrier is doing well because of its concentration in Minnesota, with a healthy local economy, along with industry capacity slowdown and an absorption already of most inflation pressure.