Southwest forecasts lingering losses as bookings slow in wake of holiday meltdown
Southwest said Thursday it expects its holiday meltdown to continue to weigh on its bottom line, but said it still expects to be profitable this year. The carrier reported a net loss of $220m for Q4 after the travel chaos drove up expenses and cost it millions in revenue during what was expected to be the busiest travel period since before the Covid pandemic. “Thus far in January 2023, the Company has experienced an increase in flight cancellations and a deceleration in bookings, primarily for January and February 2023 travel, which are assumed to be associated with the operational disruptions in December 2022,” Southwest said in a quarterly report. Analysts had been anticipating a per-share profit of 19 cents for the first quarter, based on estimates compiled by Refinitiv. The Dallas-based airline said booking trends look positive in March, however, and it forecast first-quarter revenue up 20% to 24% over last year with capacity rising 10%. It also estimated fuel and other costs would be higher than it previously estimated. Southwest’s Q4 loss compares with a $68m profit during the same period in 2021. Its record revenue of $6.17b was up more than 22% from a year earlier. Here’s how Southwest performed in Q4, compared with Wall Street expectations according to Refinitiv consensus estimates: * Adjusted loss per share: 38 cents vs an expected loss of 12 cents. * Total revenue: $6.17b vs an expected $6.16b. The airline said the mass cancellations hit its pretax results by $800m, in line with its estimate earlier this month of a hit between $725m and $825m. Southwest canceled around 16,700 flights from Dec. 21 though Dec. 31 after severe winter weather swept through the US.<br/>
https://portal.staralliance.com/cms/news/hot-topics/2023-01-27/unaligned/southwest-forecasts-lingering-losses-as-bookings-slow-in-wake-of-holiday-meltdown
https://portal.staralliance.com/cms/logo.png
Southwest forecasts lingering losses as bookings slow in wake of holiday meltdown
Southwest said Thursday it expects its holiday meltdown to continue to weigh on its bottom line, but said it still expects to be profitable this year. The carrier reported a net loss of $220m for Q4 after the travel chaos drove up expenses and cost it millions in revenue during what was expected to be the busiest travel period since before the Covid pandemic. “Thus far in January 2023, the Company has experienced an increase in flight cancellations and a deceleration in bookings, primarily for January and February 2023 travel, which are assumed to be associated with the operational disruptions in December 2022,” Southwest said in a quarterly report. Analysts had been anticipating a per-share profit of 19 cents for the first quarter, based on estimates compiled by Refinitiv. The Dallas-based airline said booking trends look positive in March, however, and it forecast first-quarter revenue up 20% to 24% over last year with capacity rising 10%. It also estimated fuel and other costs would be higher than it previously estimated. Southwest’s Q4 loss compares with a $68m profit during the same period in 2021. Its record revenue of $6.17b was up more than 22% from a year earlier. Here’s how Southwest performed in Q4, compared with Wall Street expectations according to Refinitiv consensus estimates: * Adjusted loss per share: 38 cents vs an expected loss of 12 cents. * Total revenue: $6.17b vs an expected $6.16b. The airline said the mass cancellations hit its pretax results by $800m, in line with its estimate earlier this month of a hit between $725m and $825m. Southwest canceled around 16,700 flights from Dec. 21 though Dec. 31 after severe winter weather swept through the US.<br/>
