Southwest Airlines It was expected on Thursday that third-quarter unit revenue may fall as oversupply in the U.S. market forces airlines to Discount tickets Usually the most profitable time of the year.
Southwest said unit revenue this quarter could be down up to 2% from last year and non-fuel costs could rise up to 13%, with higher expenses weighing on the airline through the end of 2024.
Shares of Southwest Airlines fell more than 6% in premarket trading Thursday.
Here’s how Southwest performed in this competition second season Compared to Wall Street expectations, according to LSEG consensus estimates:
- Earnings per share: Adjusted 58 cents compared with expectations of 51 cents
- income: $7.35 billion vs. $7.32 billion expected
The Dallas-based airline said second-quarter revenue rose 4.5% from last year to a record $7.35 billion, but profit fell more than 46% to $367 million, or 58 cents a share. Revenue per available seat mile, a measure of an airline’s pricing power, fell 3.8%, broadly in line with the airline’s revenue levels Reduce forecast last month.
Southwest Airlines reported adjusted earnings of 58 cents per share, above analysts’ expectations.
“Our second quarter results were impacted by external and internal factors and fell short of the goals we believed we had the ability to achieve,” Chief Executive Bob Jordan said in the earnings release.
Southwest Airlines said Thursday it was negotiating compensation boeing company As its sole aircraft supplier, the company has struggled to deliver aircraft on time due to safety and manufacturing crises. Southwest Airlines said it expected Boeing to deliver just 20 aircraft this year, less than half of its previous forecast.
The airline is undergoing an overhaul as investor pressure mounts to do more to boost revenue. Elliott Investment Management last month disclosed a nearly $2 billion stake in the airline and called for a leadership change.
Earlier Thursday, Southwest Airlines announced it would do so Abandoning its open seating plan It is also offering some seats with extra legroom on Boeing planes and adding overnight flights, the biggest changes to its business model in more than five decades of flying. The changes, which will begin next year, will make Southwest more like its network carrier competitors.
“We are taking urgent yet prudent steps to mitigate near-term revenue challenges and implement a long-term transformation plan designed to drive meaningful top and bottom line growth,” Jordan said in the release.
Delta Airlines and United Airlines Earlier this month, senior officials said they expected to see U.S. Production capacity begins to slow down In August, this may lead to an increase in ticket prices.
