Southwest Airlines reported its second-quarter 2025 financial results this week, revealing net income of $213 million and revenue well below Wall Street forecasts.
The Dallas-based carrier said second-quarter 2025 passenger revenues reached $6.6 billion, marking a 1.3 percent decrease, year-over-year. Meanwhile, second quarter 2025 operating revenues came in at $7.2 billion, a 1.5 percent year-over-year decrease.
Southwest is in the midst of a dramatic transformation that has seen it do away with its “Bags Fly Free” and open seating policies as it looks to become more competitive to please investors.
“We continued to make meaningful progress against our transformational plan in the second quarter, most notably implementing bag fees and a basic economy product. We had an exceptional operational rollout and continued to deliver outstanding service—a testament to our people,” Bob Jordan, President, Chief Executive Officer, & Vice Chairman of the Board of Directors, said in a statement.
“These initiatives are coming online quickly, and we are pleased with performance thus far, including bag fee revenue exceeding expectations. We are encouraged by the incremental fare product buy-up that is already occurring at this early stage and in advance of assigned and premium seating that we will begin selling next week for flights beginning January 2026,” Jordan added.
Looking ahead, Southwest expects third quarter 2025 unit revenues to be in the range of down 2 percent to up 2 percent compared to the same period in 2024. The carrier also believes that air travel demand has stabilized in the wake of disturbing declines to start the year.
Southwest’s Board of Directors has also authorized a new $2 billion share repurchase program.
Underscoring belief in our transformational plan, strong management execution, and the ability to deliver significant value for shareholders, our Board of Directors has authorized a new $2 billion share repurchase program, expected to be completed over a period of up to two years,” said Jordan.
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