Southwest Says Journey Demand Nonetheless Sturdy, Boeing Delays Could Proceed By way of 2024

A Southwest Airways Co. Boeing 737 passenger aircraft pushes again by means of the gate at Halfway Worldwide Airport (MDW) in Chicago, Illinois, U.S., Monday, Oct. 11, 2021.

Luke Brief | Bloomberg | Getty Pictures

Southwest Airlines stated on Thursday that journey demand was nonetheless robust however cautioned Delays in new ships Supply from Boeing Could proceed until 2024.

The airline reported a third-quarter revenue of $277 million on report income of $6.22 billion, up practically 33% from a yr earlier. Shares of Southwest have been up 4% in premarket buying and selling after the outcomes have been launched.

Here is how Southwest carried out within the third quarter, in comparison with Wall Avenue expectations, in keeping with Refinitiv consensus estimates:

  • Adjusted Earnings Per Share: 50 cents versus an anticipated 42 cents.
  • Gross Earnings: $6.22 billion versus an anticipated $6.21 billion.

Airways forecast additional consolidation in bookings not less than till the top of the yr. File revenues have helped carriers cowl greater prices, a reversal for one of many sectors hardest hit by the Covid-19 pandemic.

Southwest forecast a bounce in income for the ultimate three months of the yr of between 13% and 17% in comparison with 2019 ranges. It expects capability to fall by about 2% from three years in the past.

Provide chain issues, labor shortages and coaching backlogs have hindered planemakers from ramping up manufacturing to fulfill the journey growth, capping airline development, an element that may maintain airfares excessive.

Boeing CFO Brian West stated on an earnings name on Wednesday that the corporate expects Provide about 375 Of its best-selling 737 Max planes this yr, about 500 planes have been down from January’s forecast.

Southwest stated it’ll probably improve capability by 10% from 2023 through the first quarter of 2022 and 14% within the second quarter.

The airline stated “uncertainty across the timing of plane deliveries” is prompting it to be cautious on its “2023 capability plan”, which goals to have sufficient plane to function our 2023 flight schedules. , as initially revealed, in an effort to extend operational reliability. “

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