Southwest Airlines 2nd Quarter Loss Tops $1.5 Billion
DALLAS (CBSDFW.COM/AP) — Dallas-based Southwest Airlines posted an adjusted loss of $1.5 billion in its second quarter as severely diminished air travel demand continues to pound the industry amid the coronavirus pandemic.
Airlines have suffered tremendously since people began quarantining several months ago, all but drying up business and leisure travel. While some areas have seen virus cases start to decline, other areas are seeing surges, which is giving travelers pause.
"We were encouraged by improvements in May and June leisure passenger traffic trends, compared with March and April; however, the improving trends in revenue and bookings have recently stalled in July with the rise in COVID-19 cases," Chairman and CEO Gary Kelly said in a statement.
While Southwest is struggling, Kelly said the company currently doesn't plan to pursue furloughs and layoffs, or pay and benefits cuts, through they end of the year. This is because approximately 16,900 employees, or nearly 27% of its workforce, volunteered for early retirement, extended emergency time off and separation programs.
Southwest Airlines Co. moved to a quarterly loss of $915 million, or $1.63 per share, compared with a profit a year ago. Stripping out one-time gains, it lost $1.5 billion, or $2.67 per share. That's below the loss of $2.53 per share that analysts surveyed by Zacks Investment Research predicted.
While revenue of $1.01 billion slid 83% from the prior-year period, it managed to top Wall Street's estimate of $868.9 million.
Shares rose slightly in Thursday premarket trading.
(© Copyright 2020 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report.)