From CNBC · Leslie Josephs · · 1m 30s
Southwest cuts 2026 profit forecast on fuel costs
Southwest Airlines joins Delta and United in slashing profit guidance as fuel prices surge, though CEO says travel demand stays strong.
In brief
Southwest Airlines joins Delta and United in slashing profit guidance as fuel prices surge, though CEO says travel demand stays strong. Southwest Airlines cut its 2026 profit forecast to two dollars sixty cents to two dollars eighty-five cents per share from three dollars twenty-five to four dollars twenty-five cents…
Southwest slashes profit guidance
Southwest Airlines cut its 2026 profit forecast to two dollars sixty cents to two dollars eighty-five cents per share, down from July's three dollars twenty-five to four dollars twenty-five cents guidance.
Third quarter beat expectations
Southwest reported adjusted earnings per share of sixty-six cents versus fifty-eight cents expected, and adjusted revenue of eight point four two billion dollars versus eight point two five billion expected.
Fuel costs drive the cuts
Higher fuel prices are eating into Southwest's bottom line. Delta Air Lines and United Airlines also cut their 2026 profit outlooks this month for the same reason.
CEO says demand remains strong
CEO Bob Jordan said travel demand stayed strong despite higher fares. Average passenger fare rose almost twenty-seven percent to two hundred thirty-one dollars sixty-nine cents in the third quarter.
“Demand remained strong as we lapped last year's bag fee and other commercial initiatives, reinforcing our belief that the earnings power we've built is durable, even with significantly higher fuel costs.”
Southwest remade its business model
Under pressure to grow revenue, Southwest scrapped free checked bags and open seating, now charging for seat assignments and bag fees like major competitors.
The short version
Southwest Airlines cut its 2026 profit forecast to two dollars sixty cents to two dollars eighty-five cents per share from three dollars twenty-five to four dollars twenty-five cents, citing higher fuel prices that are also pressuring Delta and United.
