Shares of Spirit Airlines (NASDAQ: SAVE) stock closed yesterday down 9.27% as investors jeered the company's first-quarter financial performance. Here's a closer look at the final totals versus Wall Street's projections:

SAVERevenueYOY GrowthEPSYOY Growth
Consensus estimate $495.49 million 13.1% $0.96 84.6%
Q1 actuals $493.36 million 12.6% $0.96 84.6%
DIFFERENCE ($2.13 million)  (0.5%) $0.00  0%

Sources: S&P Capital IQ and Spirit Airlines press release. 

Commenting on the results and the strategy, CEO Ben Baldanza said in a press release:

We've announced 38 of the new routes to begin in 2015 and, over the last two fiscal quarters, we have added 12 new aircraft to our fleet all while improving our on-time performance and maintaining our high degree of reliability. Our consistent, reliable operational performance, solid track record in successfully launching new markets, and continued strong financial performance position us well for the year ahead.

What went right: Sharp increases in revenue and profit paid off on the cash flow statement, where cash from operations ballooned 85.2% to $167.8 million. Return on invested capital came in at 19.3% after taxes, a one basis point improvement over Q4's trailing 12 month performance. 

The gains come amid a massive expansion that not only has Spirit entering new markets but also using new aircraft, including five new Airbus A320s delivered during the quarter. Operating expenses zoomed in almost every category as a result. Fortunately, fuel, by far the carrier's largest expense, dipped 24.3%. Thanks to that break, total operating expenses rose just 1.6% in the first quarter.

What went wrong: Spirit isn't getting nearly as lucky with competition. Revenue per available seat mile, or RASM, declined 9.9% as Spirit reduced fares to capture flyers in new markets. Dallas proved to be a particularly challenging market, the airline said in its press release. The good news? Total capacity grew 25%. However, a 2% decline in load factor made it difficult to cash in on the extra seats. Don't be surprised if Spirit continues to employ discounting in order to gain a foothold.

What's next: Looking ahead, Spirit told investors to expect more declines in Q2. "With April mostly in the bag, based on the current fuel and pricing environment, we estimate our second quarter 2015 operating margin will be between 24.5% and 26.5%, which represents a year-over-year improvement of approximately 300 to 500 basis points," S&P Capital IQ records Baldanza as saying in a transcript of the earnings call. 

"The implied RASM decline in this guidance is between 14% to 15%, which is very similar to the first quarter, if you neutralize for the much more difficult year-over-year comparison. Much like we experienced in the first quarter, we estimate about 40% of the RASM decline is driven by our growth in new and mature markets and 35% attributable to compressed fare levels in markets other than Dallas."

Turning to the income statement, analysts tracked by S&P Capital IQ have the company generating $589.6 million in revenue and $1.43 a share in adjusted profit, versus $499.34 million and $0.91 a share in last year's Q2. Longer term, analysts have Spirit Airlines growing earnings by an average of 22.09% annually during the next three-to-five years.

In terms of the overall business, investors should keep a close eye on load factor and total revenue per passenger flight segment. Both figures will rise materially, along with profits, if Spirit finds a way to not only win, but also keep, new customers in expansion markets.

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