Southwest Airlines stock gains from record revenue and wider margins

Southwest Airlines reported record third-quarter revenue and wider margins on October 21, despite a sharp increase in fuel costs. The company said strong demand, higher fares and new ancillary products supported the performance.

Record revenue meets fuel pressure

According to the Southwest Airlines earnings release, operating revenue rose 21.2 percent year over year to 8.4 billion US dollars for the quarter ended September 30. Net income increased to 270 million US dollars from 54 million US dollars a year earlier.

Adjusted net income reached 328 million US dollars, or 0.66 US dollars per diluted share. Reported operating margin widened to 4.5 percent from 0.5 percent, while adjusted operating margin reached 5.4 percent. Aircraft fuel and related taxes rose 821 million US dollars year over year, creating a significant counterweight to the revenue improvement.

Outlook remains fuel-sensitive

Southwest expects adjusted fourth-quarter earnings per share of 0.55 to 0.80 US dollars and full-year adjusted earnings per share of 2.60 to 2.85 US dollars. The fourth-quarter outlook assumes fuel costs of about 4.55 US dollars per gallon based on the forward curve available to the company on October 15.

The airline expects fourth-quarter unit revenue to increase 19 to 21 percent year over year. Capacity is forecast to grow 3 to 4 percent, while adjusted cost per available seat mile excluding fuel, special items and profit sharing is expected to rise 4.0 to 4.5 percent.

Southwest stock and investor dates

Southwest Airlines stock traded at 39.34 euros on Lang & Schwarz at 13:33 CET on Tuesday, November 3, 2026. The company ended the third quarter with 5.6 billion US dollars of liquidity and paid 176 million US dollars in dividends during the period.

Investors can follow the real-time quote of Southwest Airlines stock for the latest market indication.

The broader US equity market can be followed through the S&P 500 market overview.

Southwest will host a Capital Markets Day in New York on March 2, 2027, when management plans to present a multi-year financial framework and related targets. More news and analyses on Southwest Airlines stock.