So Far, Southwest Is the Only U.S. Airline Whose Margin Grew

Southwest Airlines posted third-quarter operating income of $379 million, up from $35 million a year earlier, and an operating margin of 4.5 percent versus 0.5 percent. According to Travel Weekly, it is so far the only U.S. airline to report a year-over-year increase in third-quarter operating margin.

Revenue rose 21.2 percent to $8.4 billion as airfares climbed 26.9 percent, while fuel cost per gallon rose 63.3 percent and total fuel costs increased by $821 million. Net income was $270 million, and load factor held steady.

Executives credited changes passengers have felt directly: bag fees, assigned seating and extra-legroom seats, all introduced over the past 17 months. Chief commercial officer Justin Jones said assigned seating, tailored offers and dynamic pricing help the airline capture more value from its network.

Next comes a premium credit card early next year, the first airport lounges toward the end of this year, and a finished Starlink Wi-Fi rollout around this time in 2027. In-seat power and larger overhead bins arrive during 2027. For the fourth quarter, Southwest expects adjusted earnings of 55 to 80 cents per share, with fuel rising from $3.92 to about $4.55 per gallon.

Sources: Travel Weekly