Summary by Futu AI
Southwest Airlines posted a Q1 2025 net loss of $149 million ($0.26 per share), with record first quarter operating revenues of $6.4 billion driven by all-time record yields. Excluding special items, the net loss was $77 million ($0.13 per share). The company maintained strong liquidity of $9.3 billion against debt of $6.7 billion.The airline is accelerating its cost reduction initiatives, increasing its 2025 target to $370 million and 2027 run-rate savings to over $1 billion. Key operational improvements include reduced turn times at 19 airports, launch of 24-hour operations with first redeye flights, and expansion to Expedia as a new distribution channel. The company plans to introduce basic economy fares and bag fees next month.For Q2 2025, Southwest expects unit revenues to be flat to down 4% YoY with capacity up 1-2%. The company is reducing second-half capacity by approximately 1.5 points per quarter, now projecting full-year 2025 capacity growth of roughly 1% YoY. The airline remains committed to completing its previously announced $2.5 billion share repurchase program by July 2025.
