South Western Airlines reduce guidance amid “total economic uncertainty”

SouthWest Airlines issued its financial results in the first quarter of 2025, with the airline, which has undergone major changes during the past year, including an agent war with an active shareholder, as it published a net loss of 149 million dollars during this period.

However, the company warned of the current macroeconomic environment and associated certainty, which may affect the demand for travel, and therefore, southwestern Airlines decided to confirm its directive for 2025 or 2026.

Less losses

In the first quarter of his life, southwestern Airlines revenues amounted to $ 6.4 billion, including passenger revenue of $ 5.8 billion, with total revenues by 1.6 % on an annual basis (YO), another performance in the first quarter of the airline. Operating expenses were also 1.1 % less, as airlines spend $ 6.6 billion, including costs related to 62 million dollars, to maintain their operations during the quarter. In February, the company announced its first layoff at allEstimating savings of $ 210 million in 2025 and 300 million dollars in 2026.

As a result, its operational loss amounted to $ 223 million, which, with the exception of special elements, diminished to $ 128 million. The net losses improved from 231 million dollars in the first quarter of 2024 to 149 million dollars in the first quarter of 2025. The quarter review, Bob Jordan, President and CEO (CEO) of South Western Airlines, highlighted that the airline overcame its amended directives in operating expenses, adding that it was on the right path to achieve the increasing goals of the cost that it announced In March.

“We performed a great operation in the first quarter, as the industry led us to perform on time and improve in almost every operating scale, on an annual basis. We are witnessing positive results on the recent initiatives, including the launch of Expedia as a new distribution channel and remains on a path for sale in second place in second place in second place in third place. The first quarter of next year.”

Nearly 3 million passengers are less

However, its operational measures were much worse compared to the first quarter of 2024. This includes 29.9 million passengers, 8.8 % less than YY, 37.1 million passengers, and 9.2 % less than YOY, and loading factors decreased by 4.4 % to 73.9 %. The airline flew 331,886 flights compared to 349,979 during the same quarter of the previous year. At the end of the first quarter, she had 800 aircraft In its fleet, compared to 819 at the end of Q1 2024.

Meanwhile, while carrying fewer passengers through its Boeing 737 aircraft, the average passenger fare in southwest airlines rose from $ 173.76 to $ 193.75, with the passenger’s revenues in the passenger’s revenue (RPM) decreased to 18.97 ¢. In Q1 2024, it was 17.26 ¢.

The company helped significantly decrease fuel costs compared to the same quarter of last year, as the average fuel costs per gallon, including fuel tax, $ 2.49, or 14.7 % less than annually. Thus, while its cost per mile is available (CASM) was 16.05 ¢, or only by 0.9 % annually, CASM was excluding fuel and oil costs (CASM-X) 6.2 % higher than Q1 2024, or 13.04 ¢.

In a good position for the future

According to Jordan, SouthWest Airlines is developing more than ever, as the airline removed free bags that have been examined for all passengers (as of May 28), Despite her previous research, which shows that she will be a loss stepAnd control the rapid reward points rates for their low -class members. At the same time, the airline is working to update its cabin with more installment seats, which includes critical amenities at the present time, such as charging in the seat, Red Al Ain trips have already been launchedInternational airlines partnerships, and provided dedicated seats on their aircraft.

However, the CEO stated that initiatives must improve their commercial and financial offers, and benefit their customers and shareholders. “We are in a good position with and committed to a strong and effective public budget at the investment level. We have a valuable contract command book with Boeing that provides flexibility. ” Jordan added.

However, by responding to the current macroeconomic environment, caused by doubtful commercial policies for the current US administration, southwestern airlines reduce the capacity in H2 2025, which may lead to a capacity of 2025 by 1 % higher on an annual basis only. In addition, the airline stated that the current economic uncertainty, which made the prediction difficult due to the modern and short -term reservation trends, led it to a decision against the repetition of its profits 2025 or 2026 before the directives of interest and taxes (EBIT).

Q2 revenues for each ASM (RASM) should be flat to 4 % less than annually, with capacity, measured in Asms, growth between 1 % and 2 %. Fuel costs should decrease between $ 2.20 and $ 2.30 per gallon, while CASM-X should reach 3.5 % to 5.5 % on an annual basis. During the quarter, the payment of debts during the quarter must be about $ 2.6 billion.