southwest airlines The airline this month became the third major U.S. airline to cut its 2026 profit forecast due to rising fuel prices, but CEO Bob Jordan said travelers were continuing to book despite the fare increases.
The company now expects adjusted earnings of $2.60 to $2.85 per share this year, down from its July forecast of $3.25 to as much as $4.25 per share.
Here’s how Southwest reported in the third quarter compared to Wall Street expectations, according to LSEG consensus estimates.
Earnings per share: 66 cents adjusted, 58 cents expected Earnings: $8.42 billion adjusted, $8.25 billion expected
Southwest Airlines expects fourth-quarter adjusted earnings per share to range from 55 cents to 80 cents, with unit revenue, a measure of airfare, up as much as 21% year over year. The company said it expects production capacity to increase by up to 4% year-on-year.
“Demand remains strong as we achieved last year’s baggage fees and other commercial initiatives, reinforcing our belief that the profitability we have built is durable, even as fuel costs rise significantly,” Jordan said in an earnings call.
The company said average passenger fares in the third quarter were $231.69, an increase of about 27% compared to the same quarter in 2025. A spokesperson said the figure did not include additional charges. The number of paid passenger passengers decreased by 3.2% to 33.47 million.
But Jordan told CNBC’s Phil LeBeau that demand is strong across all regions and products.
“Consumer momentum is incredibly strong and shows no signs of slowing down,” Jordan said. “We are seeing strength both during the holiday period and outside the holiday period.”
Under pressure to increase revenue, Southwest Airlines over the past few years has reworked its long-standing business model, eliminating old policies such as two free checked bags per passenger and unreserved seats. Instead, Southwest Airlines, like its major competitors, started charging for many seat reservations and added baggage fees.
Southwest’s net income for the third quarter was $270 million, or 55 cents per share, up from $54 million, or 10 cents per share, in the year-ago period. Revenue increased more than 21% to $8.42 billion.
Adjusted for one-time items, Southwest reported 66 cents per share.
delta airlines and united airlines When the company announced its third quarter results, it also lowered its profit forecast for the rest of the year. Both of these airlines reported third-quarter revenue and bottom line failures.
