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Mar 31, 2025
Southwest Q1 2025 Earnings Report
Southwest Airlines reported a net loss amid record revenue, citing softness in domestic leisure demand and macroeconomic challenges.
Key Takeaways
Southwest Airlines posted a Q1 net loss of $149 million despite achieving record revenue of $6.4 billion, driven by improved yields and cost efficiencies. Domestic leisure softness and inflationary pressures impacted results.
Recorded $6.4 billion in revenue, a Q1 record
Net loss of $149 million despite operational cost efficiencies
Average passenger fare rose 11.5% year-over-year
Fuel efficiency improved due to higher use of -8 aircraft
Revenue by Segment
Forward Guidance
Q2 guidance reflects continued initiative benefits but acknowledges soft booking trends and inflation pressures.
Positive Outlook
- RASM expected flat to down 4%, showing resilience amid demand softness
- Capacity (ASMs) projected up 1% to 2%
- CASM-X rise expected to moderate (3.5%–5.5%)
- Fuel costs expected to drop to $2.20–$2.30/gallon
- Ongoing cost initiatives reaffirmed with $1.8B EBIT contribution target for 2025
Challenges Ahead
- Continued softness in domestic leisure travel demand
- Second-half capacity reductions due to macro uncertainty
- No reaffirmation of full-year 2025/2026 EBIT guidance
- Inflationary pressure on labor and other costs persists
- RASM outlook impacted by competition and weaker booking trends
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
Analyze how earnings announcements historically affect stock price performance
Avg. Return Before/After Earnings
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