Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Southwest Slips As Q2 Numbers Show Turbulence In Recovery

Published 07/22/2021, 11:45 AM
Updated 07/22/2021, 11:46 AM
© Reuters.

© Reuters.

By Dhirendra Tripathi

Investing.com – Southwest Airlines (NYSE:LUV) stock fell almost 4% Thursday as the airline’s April-June numbers still came lower than 2019 quarter’s with some hope of recovery though not full in the ongoing quarter.

The company, like American Airlines (NASDAQ:AAL) which also announced its second quarter earnings today, managed to post its first monthly profit in June since the negative effects of the pandemic began in March 2020. This was driven by a surge in leisure travel as people took to travelling after a year’s gap.

Business travel remained sluggish though the company said July has seen weekly improvements in that segment.

The company's second-quarter operating revenue of $4 billion is still almost two-third of 2019 June quarter level.

Load factor was at 89.2% compared to 86.4% in June quarter of 2019.

The company expects load factor to fall month-on-month through August. Operating revenue in July is seen lower by 10%-15% and by 12%-17% in August compared to 2019 levels in those months, respectively, due to fewer holidays from last year.

“Despite steady weekly improvements in business bookings, thus far, in July, the lag in business travel recovery is expected to continue to have a negative impact on close-in demand and average passenger fares in third quarter 2021,” Gary C. Kelly, chairman of the board and chief executive officer, said in a note.

Second quarter net income was $348 million, or 57 cents per diluted share, driven by a $724 million offset of salaries, wages, and benefits expenses related to the receipt of federal government’s fiscal stimulus.

Excluding special items, second quarter net loss was $206 million, a far cry from the $741-million net income in April-June of 2019.

 

  

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.