LUV Q1 2025 Earnings

Call Details

• Call Title: Southwest Airlines Company Q1 2025 Earnings Call
• Date: April 24, 2025 at 4:30 PM UTC
• Management Team:
  • Julia Landrum (Vice President of Investor Relations)
  • Bob Jordan (President, CEO, and Vice Chairman of the Board)
  • Andrew Watterson (Chief Operating Officer)
  • Tom Doxey (Executive Vice President and Chief Financial Officer)
  • Whitney Eichinger (Chief Communications Officer)

Call Summary

Financial Performance

• Operating revenue was a quarterly record at $6.4B and RASM increased 3.5% year-over-year on all-time record yields.
• Non-fuel CASMx grew 4.6% in Q1, which materially outperformed the previously adjusted guidance of approximately 6%.
• First-quarter completion factor was 98.6%, which was the best in 12 years and contributed to industry-leading on-time performance.
• GAAP EPS and specific passenger count metrics were Not disclosed on the call.
• RASM outperformance was attributed to early returns from revenue management, distribution expansion, and network initiatives.
• Operational reliability metrics cited included leading on-time percentage and fewest extreme delays in the quarter.

Guidance

• Company is not reiterating full-year 2025 or full-year 2026 EBIT guides due to macroeconomic uncertainty and softer booking trends.
• Company reaffirmed initiative incremental EBIT targets of $1.8B for 2025 and $4.3B for 2026 as multi-year goals.
• Second-quarter RASM is guided to be flat to down 4% year-over-year while second-quarter capacity is guided up 1% to 2% year-over-year.
• Second-quarter CASMx is expected to increase in the 3.5% to 5.5% range year-over-year.
• Basic economy, bag fees, and flight credit expiration will apply to bookings on or after May 28th and are expected to provide minimal Q2 contribution.
• Company will begin selling premium and assigned seating in Q3 2025 for flights operating in Q1 2026, concentrating material RASM benefit into 2026.